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Friday, August 28, 2015

Debt ridden Ukraine asks Russia for lower gas prices for coming winter season

Debt ridden Ukraine asks Russia for lower gas prices for coming winter season. (AP).

Emboldened by a deal with international creditors to write down part of its debt, Ukraine on Friday asked Russia for lower gas prices for the winter season.

Russia and Ukraine last year struck an emergency deal on prices through the winter. That deal has expired, however, and the sides have to hold new talks if Ukraine is to receive more Russian gas.

Prime Minister Arseniy Yatsenyuk said on Friday he is convinced that Kiev and Moscow should go back to the last winter deal, which saw Ukraine pre-pay for gas but receive a sizeable discount.

"We are convinced that the only mechanism to ensure a gas transit to the EU as well as stable supplies to Ukraine is applying the same mechanism that was worked out last year between the EU, Ukraine and Russia," he said in comments released by his press office.

The Ukrainian government on Thursday reached a deal with its international bondholders to lighten its public debt burden. It will see the creditors write off 20 percent of their bond holdings, shrinking $19 billion in sovereign debt to $15.5 billion.

Russian creditors did not take part in talks, but Ukrainian Finance Minister Natalie Jaresko on Thursday insisted that Moscow should accept the same terms because "it would not get a better deal" than Ukraine's other creditors.

Moscow insists that it wants to be fully repaid for a $3 billion loan it gave to Ukraine. The debt is due at the end of the year.

Speaking to reporters late Thursday, Russian Finance Minister Anton Siluanov noted that Russia's loan "was not a commercial one. We provided funds for Ukraine with a below-market interest rate."
 Hmmmm......"Gazprom" has asked the Stockholm arbitration to collect the $ 29.2 billion Gas debt from Ukraine.Read the full story here.

Related:   Belarus ready to increase Russian gas transit to EU if needed.

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