MOSCOW, December 28 (Reuters) - Russia said on Monday it had agreed terms for a new oil deal with Ukraine a few hours after spooking Europe with a warning the continent could face oil supply cuts because of a dispute between Moscow and Kiev.
“Within the framework of intensive negotiations, the terms of a transit deal have been agreed,” a spokeswoman for Russia’s energy ministry said, adding that the deal would be signed in the coming days and no interruption in supplies was expected.
The statement came hours after Slovak prime minister Robert Fico said he saw an increased risk of a halt in Russian oil supplies to Hungary, Slovakia and the Czech Republic via Druzhba, a major oil pipeline crossing Ukraine, from January 1.
Europe, which receives much of its oil and gas from Russia, has closely tracked disputes between Russia and its neighbours after European Union gas supplies were cut in the dead of winter in 2006 and 2009 due to rows between Russia and Ukraine.
A fifth of the EU’s gas comes from Russia, the world’s largest oil and gas producer, via pipelines across Ukraine. Ukraine itself is reliant on gas from Russia and has disagreed with Moscow in the past over price.
A Russian oil pipeline monopoly executive said on Monday the tension had arisen because Ukrainian politicians were setting “unacceptable” terms for transit of Russian oil via Ukraine’s Black Sea port of Yuzhny.
Ukraine moved to calm any fears of another stand-off over energy between the two former Soviet republics on New Year’s Day like the one at the start of this year, when gas supplies were cut and millions of Europeans were left in the cold.
“Within Ukraine there are no threats, no risks,” said Bohdan Sokolovsky, the energy envoy of Ukraine’s President Viktor Yushchenko, adding that Moscow’s warning to the EU about a possible oil supply halt was aimed at discrediting Kiev.
The earlier cuts occurred amid strained political relations between Moscow and its neighbours. Ukraine will hold a presidential election in January and analysts have said that if a relatively pro-Russian leader is elected, Moscow is likely to take a more accommodating stance in future energy negotiations.
On Monday, the head of Russian gas giant Gazprom, Alexei Miller, said he saw no repeat of gas rows with Ukraine, backtracking from remarks made last week.
US crude oil rose to above $79 a barrel on Monday, the highest in more than a month, largely because of colder weather across the US. The tensions involving Russia provided additional support.
Mr Sokolovsky said Ukraine wanted Russia to pay higher transit fees, switch to euros from dollars and guarantee minimal supply volumes, adding that demands had been sent to Moscow in November.
Russia’s energy ministry did not say how new demands were solved by the two sides late on Friday. The demand comes as the International Monetary Fund has rejected Kiev’s request for a $2bn loan to help the recession-strapped country meet obligations by year’s end.
A European Union source said oil stocks in Hungary, Slovakia and the Czech Republic were adequate to withstand possible cuts.
Russia sent its warning to the European Union suggesting a possible repeat of the January 2007 oil dispute with Belarus. Belarus cut Russian oil flows to Europe via the same Druzhba oil pipeline in January 2007, also due to a pricing row, which further undermined the image of Russia as a reliable supplier.
“From the EU point of view, the early warning systems have worked,” said a EU source, referring to a recent deal under which Russia has to warn the continent about supply problems.
The Druzhba pipeline supplies Slovakia, Hungary and the Czech Republic via Ukraine with more than 300,000 barrels per day of crude while another spur goes via Belarus to Germany and Poland shipping some 800,000 bpd. Germany and Poland so far have no guarantees of supplies in the new year as Moscow and Minsk are struggling to agree on volumes of duty-free Russian oil for Belarus.
Russia’s top energy official Igor Sechin said on Monday he hoped the deal with Belarus would be signed on December 30-31. “If no deal is reached then we will have to apply full fees from January 1,” he told reporters.
