Ukrainian Foreign Minister Kostiantyn Hryschenko has said that without the discount on Russian gas secured under the Kharkiv Agreement, the Ukrainian economy would not have been able to maintain its balance of payments.
"Without the discount we are getting as a result of the agreements reached in Kharkiv, the situation in the economy would simply be catastrophic," the minister said at a briefing in Kyiv on Wednesday.
The gas contracts signed in 2009 caused such long-term damage to the Ukrainian economy that even the discount extended to Ukraine per the Kharkiv Agreement did not resolve the problems, Hryschenko said.
"Without that discount, we would simply be unable to have today any kind of balance of payments in the economy," he said.
As reported, according to agreement struck between Russian and Ukraine in Kharkiv in April of 2010 Russia’s Black Sea Fleet can remain in Crimea for another 25 years starting in 2017, with the possibility of extending the fleet’s presence another five years if neither of the parties announces a withdrawal from the agreement. In return, Russia is extending Ukraine a gas discount of $100 off of a gas price over $330 per 1,000 cubic meters.
The price of the Russian natural gas at which NJSC Naftogaz Ukrainy imported in the first quarter of this year was $416 per 1,000 cubic meters including the Kharkiv discount, and in the second quarter the price went up to $426. Without the discount, the gas would have cost $516 and $526 per 1,000 cubic meters.
