Ukrainian people are in for a rude awakening – Welcome to the West!

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Offline Letsbereal

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Gazprom Boosts Ukraine Overdue Invoice To $3.5 Billion After Kiev Forgot To Pay April Bill
7 May 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-05-07/gazprom-boosts-ukraine-overdue-invoice-35-billion-after-kiev-forgot-pay-april-bill

Looks like Ukraine won't be buying that gold with IMF loan proceeds after all.

Moments ago, in what has become a monthly tradition, Gazprom reported that Ukraine has once again forgotten to pay its latest monthly, April, gas bill.

As a result, the total amount of money now due rises from $2.2 billion which was the invoice through the end of April, to $3.5 billion.

As RT reminds us, and as was reported previously, this means that in June Ukraine might receive Russian gas only on the condition of advanced payment.

From RT:

"The deadline has passed, no payment has been received," said Sergey Kupriyanov, the company's representative.

Earlier the company said that if the deadline was not met, Gazprom would issue an advance bill for June gas supplies on May 16.

Naftogaz, Ukraine’ state-owned oil and gas company, has a long record of late payments and unpaid bills to Gazprom, a problem which has only gotten worse as Ukraine has slipped into revolution and civil unrest.

The debt as of May 7, 2014 stands at $3.508 billion, Gazprom said Wednesday, which is up from $2.2 at the end of April.


This latest number is notable because as was reported overnight, Ukraine said that it had gotten the first IMF bailout tranche of some $3.2 billion.

Naturally, since the Gazprom receivable is greater than this amount, and since Ukraine will further have to prepay future gas deliveries, it means that all of the money funded by US taxpayers among others and then some, will go straight into the pockets of the Kremlin.

Additionally, we also learned what the terms of the indirect US payment to Gazprom will be:

- UKRAINE TO ONLY PAY INTEREST ON IMF LOAN FOR 3 YEARS: MINISTRY

- UKRAINE TO REPAY IMF PRINCIPAL QUARTERLY OVER 2 YRS: MINISTRY

- UKRAINE SAYS GOVT TO PAY 3% INTEREST A YEAR ON IMF BAILOUT


The IMF clarified that out of the $3.2 billion amount, Naftogaz may be eligible to use up just $2.16 billion to pay off its debts to Gazprom, according to documents prepared by the fund.

In other words, not nearly enough to cover the due bill.

Furthermore, Ukraine is hoping that it will get another $13.7 billion from the IMF which however is in doubt if indeed this Sunday's referendum is not postponed and if the republic of Donetsk votes to effectively split Ukraine in two.

As for future payments...

Ukraine says it is ready to pay its gas debt to Russia’s Gazprom as long as the company lowers prices from $485 per 1,000 cubic meters down to $268.50, the price the country enjoyed under ousted President Viktor Yanukovich.

Moscow ended the discount in April, raising gas prices nearly 50%.

The second $100 gas hike came in April when Russia canceled its Black Sea Fleet host agreement with Ukraine after Crimea voted to join Russia.

Moscow said Kiev owes $11.4 billion for all the discounts it received since the 2010 deal.

Russian Energy Minister Aleksandr Novak warned over the weekend that the situation with gas transit through Ukraine had reached a “very critical point” as the gas supplies in underground storage facilities have dropped to a point where they can’t guarantee supplies from Russia to Europe.


The implicit threat as always remains that should the Ukraine be unable to fulfill its obligations to Russia, not just Ukraine's gas needs will be compromised:

Gazprom supplies Europe with 30% of the continent’s natural gas. Half of these Russian supplies are shipped through Ukraine.

Said otherwise if Ukraine uses even a dime from the IMF funding for any other purpose: say to refuel its helicopters and/or tanks currently used to keep the "separatists" at various eastern cities at bay, Europe too will suffer a cut in its deliveries.

And now back to random headlines proclaiming some mythical, imminent "de-escalation" in the Ukraine.
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Offline Letsbereal

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Ukraine gets its Mafia-type Loan
8 May 2014
, by Pepe Escobar (rinf)
http://rinf.com/alt-news/breaking-news/ukraine-gets-mafia-type-loan/

The International Monetary Fund has approved a US$17 billion loan to Ukraine. The first $3.2 billion tranche arrived on Wednesday.

It’s essential to identify the conditions attached to this Mafia-style “loan”. Nothing remotely similar to reviving the Ukrainian economy is in play.

The scheme is inextricably linked to the IMF’s notorious, one-size-fits-all “structural adjustment” policy, known to hundreds of millions from Latin America and Southeast Asia to Southern Europe.

The regime changers in Kiev have duly complied, launching the inevitable austerity package – from tax hikes and frozen pensions to a stiff, over 50% rise on the price of natural gas heating Ukrainian homes.

The “Ukrainian people” won’t be able to pay their utility bills this coming winter.

Predictably, the massive loan is not for the benefit of “the Ukrainian people.” Kiev is essentially bankrupt.

Creditors range from Western banks to Gazprom – which is owed no less than $2.7 billion.

The “loan” will pay back these creditors; not to mention that $5 billion of the total is earmarked for payments of – what else – previous IMF loans.

It goes without saying that a lot of the funds will be duly pocketed – Afghanistan-style – by the current bunch of oligarchs aligned with the “Yats” government in Kiev.

The IMF has already warned that Ukraine is in recession and may need an extension of the $17 billion loan.

IMF newspeak qualifies it as “a significant recalibration of the program.”

This will happen, according to the IMF, if Kiev loses control of Eastern and Southern Ukraine – something already in progress.

Eastern Ukraine is the country’s industrial heartland – with the highest GDP per capita and home of key factories and mines, mostly in the Donetsk region, which happens to be largely mobilized against the neo-fascist/neo-nazi-aligned regime changers in Kiev.

If the current conflagration persists, this means both industrial exports and tax revenues will go down.

So here’s the IMF prescription for the oligarch bunch – some of them actively financing Right Sector militias:

As long as you’re facing a popular rebellion in Eastern and Southern Ukraine, relax; you will get additional IMF cash further on down the road.

Talk about a crash course in disaster capitalism. We want you to invade

Meanwhile, the Obama administration’s juvenile delinquent school of diplomacy remains on track: the plan is to entice Moscow to “invade.”

Benefits would be immense.

Washington would destroy once and for all the emerging strategic partnership between the EU, especially Germany, and Russia, part of a more organic interaction between Europe and Asia; keep Europe perennially under America’s thumb; and boost Robocop NATO after its Afghan humiliation.

Well, they are not juvenile delinquents for nothing. Yet this brilliant plan forgets a key component: enough competent troops willing to apply Kiev’s designs.

The regime changers dissolved the Berkut federal riot police.

Big mistake – because they are pros; they are unemployed; and now, holding a monster grudge, amply supporting Ukrainians in favor of federalization.

What the Ministry of Truth script imposed on all Western corporate media insists on labeling “pro-Russian separatists” are in fact Ukrainian federalists.

They don’t want to split. They don’t want to join the Russian Federation. What they want is a federalized Ukraine with strong, autonomous provinces.

Meanwhile, in Pipelineistan…

Washington is actively praying that the confrontation between the EU and Russia on the gas front spirals out of control.

Natural gas will amount to 25% of the EU’s needs up to 2050. Since 2011 Russia is the number one supplier, ahead of Norway and Algeria.

The bureaucrat-infested European Commission (EC) is now concentrating its attacks on Gazprom on the South Stream pipeline – whose construction starts in June.

The EC insists that the agreements already struck between Russia and seven EU countries infringe the laws of the EU (how come they didn’t find that out earlier?).

The EC would like South Stream to become a “European,” not a Gazprom project.

Well, that depends on a lot of serious diplomacy and the internal politics of various EU member states. For instance, Estonia and Lithuania depend 100% on Gazprom.

Some countries, such as Italy, import over 80% of their energy; others, such as the UK, only 40%.

It’s like the EC suddenly woke up from its usual torpor and decided that South Stream is a political football.

Günther Oettinger, the EU’s energy commissioner, has been blaring the horn of EU competition laws called “the third energy package” – which would essentially require Gazprom to open South Stream to other suppliers.

Moscow filed a complaint to the World Trade Organization (WTO).

Rigorous application of recently unearthed EU law is one thing. Facts on the ground are another. South Stream may cost up to €16 billion – but it will be built, even if financed by Russia’s state budget.

Moreover Gazprom, in 2014 alone, has already signed extra deals with German, Italian, Austrian and Swiss partners.

Italy’s ENI and France’s EDF are partners from the start. Germany, Italy, Bulgaria, Hungary and Austria are deeply involved in South Stream.

No wonder none of them are in favor of more sanctions on Russia.

As for any substantial move by the EU to find new supply sources, that’s a process that should take years – and should involve the best possible alternative source, Iran, assuming a nuclear deal with the P5+1 is struck this year.

Another possible source, Kazakhstan, exports less than it could, and that will remain the case because of infrastructure problems.

So we’re back to the Ukrainian tragedy. Moscow won’t “invade.” What for?

The IMF’s structural adjustment will devastate Ukraine more than a war; most Ukrainians may even end up begging Russia for help.


Berlin won’t antagonize Moscow. So Washington’s rhetoric of “isolating” Russia is just revealed for what it is: juvenile delinquency.

What’s left for the Empire of Chaos is to pray for chaos to keep spreading across Ukraine, thus sapping Moscow’s energy.

And all this because the Washington establishment is absolutely terrified of an emerging power in Eurasia.

Not one, but two – Russia and China. Worse: strategically aligned. Worse still: bent on integrating Asia and Europe.

So feel free to picture a bunch of Washington angry old men hissing like juvenile delinquents: “I don’t like you. I don’t want to talk to you. I want you to die.”
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Offline Letsbereal

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Gazprom Threatens to Halt Gas Shipments to Ukraine on June 3
« Reply #42 on: May 12, 2014, 07:56:42 PM »
Gazprom Threatens to Halt Gas Shipments to Ukraine on June 3
12 May 2014
, by Anton Doroshev and Elena Mazneva (Bloomberg)
http://www.bloomberg.com/news/print/2014-05-12/gazprom-threatens-to-halt-gas-shipments-to-ukraine-on-june-3.html

Excerpt:

Russia threatened to stop supplying gas to Ukraine on June 3 unless the country starts paying for the fuel in advance.

Tomorrow, OAO Gazprom will send Ukraine a bill for June, Chief Executive Officer Alexey Miller said today at a meeting with Russian Prime Minister Dmitry Medvedev.

If the bill isn’t paid by June 2 the neighboring country won’t receive any Russian gas from 10 a.m. the next morning, Miller said.

“It’s time to stop coddling them, notify them tomorrow and move to pre-payments,” Medvedev said during the meeting.

“I think that all possible ways to settle this situation using other measures were undertaken by Gazprom.”

The deadline marks an escalation in the dispute over energy supplies that’s an element in the broader struggle for Russian influence over Ukraine.

Stopping shipments to Ukraine may have an impact on the rest of Europe because about 15% of the region’s gas travels through the country’s Soviet-era pipeline system.

Ukraine, which depends on Russia for half of its gas consumption, has been seeking to renegotiate a 2009 gas contract since before unrest began in Ukraine’s capital in November.

Russia is moving Ukraine to prepayments because it owes $3.51 billion for fuel delivered in 2013 and through April this year, Miller said today.
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Offline Letsbereal

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Russia to Discuss Gas Price Cut With Ukraine Only If Debt Paid
« Reply #43 on: May 12, 2014, 08:01:16 PM »
Russia to Discuss Gas Price Cut With Ukraine Only If Debt Paid
12 May 2014
, by Elena Mazneva (Bloomberg)
http://www.bloomberg.com/news/print/2014-05-12/russia-to-discuss-gas-price-cut-with-ukraine-only-if-debt-paid.html

Excerpt:

Russia will consider a compromise on natural gas prices with Ukraine only after its neighbor pays its debt for previous supplies, the Energy Ministry said as preparations for talks begin in Brussels today.

Ukraine hasn’t used any of the funds received under a $27 billion international package to pay down its gas debt, Russian Deputy Energy Minister Anatoly Yanovsky told reporters today in Moscow.

The country sandwiched between Russia and the European Union received the first $3.2 billion of aid last week.

OAO Gazprom, Russia’s gas exporter, has billed Ukraine for $3.51 billion for fuel delivered in 2013 and through April.

Europe imports about 30% of its gas from Russia, half of which crosses Ukraine, tying the EU’s energy security to stability in the transit country.

Ukraine, which depends on Russia for half of its gas consumption, has been seeking to renegotiate a 2009 gas contract since before a popular uprising began in Ukraine’s capital in November.

Russia doesn’t need “pain and suffering” in Ukraine, Yanovsky said, after being asked about sanctions.

“We want to trade normally and receive a normal price for our goods.”

Gazprom raised the price it charges Ukraine for gas by 81% in April, to $485 per 1,000 cubic meters, more than any EU member pays.
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Offline Letsbereal

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The Farce Is Complete: Joe Biden’s Son Joins Board Of Largest Ukraine Gas Producer
13 May 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-05-13/farce-complete-joe-bidens-son-joins-board-largest-ukraine-gas-producer
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Offline Letsbereal

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'No more mollycoddling!' Moscow calls out Ukraine's gas debt denial
« Reply #45 on: May 13, 2014, 12:22:50 PM »
'No more mollycoddling!' Moscow calls out Ukraine's gas debt denial https://www.youtube.com/watch?v=dNmqJt49zL4

13 May 2014, RT
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Offline Letsbereal

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'Greece-like austerity looms in Ukraine from harmful EU loan'
« Reply #46 on: May 14, 2014, 09:14:10 AM »
'Greece-like austerity looms in Ukraine from harmful EU loan' https://www.youtube.com/watch?v=3GFI2y4m6J4

14 May 2014, RT
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Offline Juntawatch

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  • "This ain't Rock-n'-Roll;     This is Genocide."
 Hmmmm! The Globalist has Europe, and has had, since the 70's by steps and degrees.

 Britain was assimilated on 1 Jan, 1973 along with all the other original unelected recruit states.

 Now the Global Cabal turn their eyes to the former SOVIET and BALTIC STATES for acquisition.

 Estonia and Lithuania were 'Annexed' on May 1, 2004. Ten-Years ago precisely.

 

 The Former Soviet Union centred at Moscow, then has reason to be affeared of it's future.

 The UNION is coming for you and there's nothing that you can do without a HUGE MILITARY INDUSTRIAL COMPLEX to back up any new 'Cold-War' stand-off..

 It's the same nightmare as the Bay-of-Bigs, Kennedy Assasination, Johnson Coup-D'etat and the subesequent continuation of the war in Vietnam. The strategy is Military Industrialism and to quote from Dave the ex-Bay-of-Pigs Training Camp officer, in J.F.K (the movie), just before he got bumped off;
- when asked by Garrison:

 -  'So, who killed Kennedy'?
-- "Stop being so dumb;  It's a Mystery, a mystery inside a riddle wrapped in an enigma; even the shooters didn't know who did it."

 Thing is, I Junta was predicting precisely the development and appearance suddenly of "A cold-war Fall-back Position, with a Stand-off with Russia", specifically as a distraction from the ongoing 9/11 INTRIGUES and ongoing demands for an 'Independent 9/11 Commission Enquiry'. Because to Junta, where he stands, it is clear from his perception of the world in relation to American Foreign Policy and the innate fear Americans have of Communism and Russia, as instilled upon and in them from School, (in my generation and the preceeding generation) that a new 'Stand-Off' with an apparently revived Soviet-Union is all it will take to rid for another quarter-century (Yes, another 25-years) any serious desire or ability in establishment circles (increasingly, perhaps) for a continuing investigation of what actually happened on 9/11. The idea also has always been from the outset to have 9/11 archived in our collective memory in the same fashion and under the same category as the JFK Assasination. Both equally traumatic and both convenienlty surrounded by deep unresolved intrigues and irresolved accusations of Conspiracy.

 See the EUCOUNTRY LIST MAP and the original 'Assimilation' dates.
 http://eucountrylist.com/
 
"The Dog has returned to its own vomit, and the sow that was bathed to rolling in the mire."
2 Peter, 2:2.

'The Intellectual, the Plebitian & the Proletariat could be treated; just as wasps are treated.'
- Sanctimonious III. 1st Century.

Offline Letsbereal

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EuroMaidan Nightmare: How the Odessa Massacre Was Engineered in Ukraine
« Reply #48 on: May 15, 2014, 08:23:47 PM »
EuroMaidan Nightmare: How the Odessa Massacre Was Engineered in Ukraine https://www.youtube.com/watch?v=HZQZ7MspzB8

15 May 2014, GlobalResearchTV

This video put together by the Oriental Review Open Dialogue Journal in Russia documents how the Odessa Massacre was engineered by the US-backed Yatsenyuk regime and its ultra-nationalist thugs.
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Offline Letsbereal

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Ukraine Needs $4.2 Billion or More in Bank Boost, Kubiv Says
« Reply #49 on: May 18, 2014, 02:17:37 PM »
Ukraine Needs $4.2 Billion or More in Bank Boost, Kubiv Says
16 May 2014
, by Daryna Krasnolutska and Andras Gergely (Bloomberg)
http://www.bloomberg.com/news/print/2014-05-15/ukraine-needs-4-2-billion-or-more-to-shore-up-banks-kubiv-says.html

Excerpt:

Ukraine’s banks need at least 50 billion hryvnia ($4.2 billion) to 60 billion hryvnia in fresh capital, central bank Governor Stepan Kubiv said, giving a more downbeat view than the country’s biggest foreign lender.

The monetary authority seeks to maintain the solvency of the banking system after Russia’s annexation of Crimea and a war against pro-Russian separatists in the east drove off foreign investors and shut bank branches in areas wracked by violence.

The economy may shrink 7% this year, the European Bank for Reconstruction & Development said this week. The hryvnia extended the world’s biggest slump today.

Ukraine’s banking system will probably see a year or two of losses as local and foreign-owned lenders “freeze operations” until they get more clarity on the country’s future, analysts at Raiffeisen Bank International (RBI) AG, including Gunter Deuber in Vienna, wrote yesterday.

Raiffeisen, the biggest foreign bank in the country, sees recapitalization needs between $3 billion and $5 billion in the coming 18 months as the hryvnia’s devaluation curbs banks’ capital adequacy.

Ukraine is going “through a period of bank insolvencies and consolidation,” Kubiv said yesterday in an interview at the EBRD’s annual meeting in Warsaw.

“Our preliminary estimation exceeds Raiffeisen’s by a bit.”
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Offline Letsbereal

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Russia ready to give gas discount to Ukraine if debt partially paid off
« Reply #50 on: May 19, 2014, 11:55:48 AM »
Russia ready to give gas discount to Ukraine if debt partially paid off - energy minister
16 May 2014
, Moscow (ITAR-TASS)
http://en.itar-tass.com/economy/731921

Russia is ready to give a discount for natural gas to Ukraine should Kiev pay off its debt to the tune of $2.237 billion, accumulated over the period until April 1, Russian Energy Minister Alexander Novak told journalists Friday.

The debt of Ukrainian state energy company Naftogaz for the first quarter of 2014 totaled $1.6 billion.

Besides, Ukraine remains in debt for 2013, owing some $637 million.

Ukrainian state energy company Naftogaz’s debt to Moscow currently totals some $3.508 billion with the gas price standing at $485.5 per 1,000 cubic meter.

Moscow recently substantially raised the price for gas supplied to Ukraine from the figure of $268.5 per 1,000 cubic meters agreed last year when an association agreement with the European Union was shelved in November 2013.

In the second quarter of 2014, the price for Russian gas for Ukraine was set at $385.5 per 1,000 cu m.

Russian state energy giant Gazprom said earlier that the price rose from $268.5 due to the return to earlier contract agreements, as Ukraine failed to fulfill its commitments under an additional agreement concluded in December 2013, which obliged the country to pay for supplied volumes of Russian gas in time.

On April 2, Russian President Vladimir Putin signed a law on denunciation of the Kharkiv Accords with Ukraine, which were struck in 2010 and stipulated that Russia’s lease of naval facilities in Crimea (then part of Ukraine) would be extended by 25 years beyond 2017 - until 2042.

The Kharkiv deals envisioned a discount of $100 per 1,000 cubic meter on Russian gas for Kiev.

Now that the accords have been denounced due to Crimea’s accession to the Russian Federation, the discount is no longer applied, raising the gas price by another $100 to $485.5 per 1,000 cubic meter.

Ukraine saw a coup in February, with new people brought to power amid riots as President Viktor Yanukovych had to leave the country citing security concerns.

Crimea refused to recognize the new Kiev authorities and seceded from Ukraine to join Russia after a referendum in March.

State company Naftogaz of Ukraine’s purchases of Russian gas over 5 months of 2014 will have equaled imports for the entire 2013, shows Russian monopoly Gazprom’s data on gas exports to Ukraine.

In the first four months of 2014, Nazftogaz imported 2.45 billion cubic metres, 1.64 billion cubic metres, 1.86 billion cubic metres and 2.7 billion cubic metres respectively.

Over 12 days of May, export amounted to 1.35 billion cubic metres, which means that by the end of May, Naftogaz will have probably imported a total of about 11 billion cubic metres since the year-start.

Last year, the company bought 12.9 billion cubic metres of Russian gas.

Total gas imports were about 20 billion cubic metres, with more than 40 billion cubic metres consumed within the country.

Naftogaz has not yet paid for 2014 supplies. Gas debt for January - March imports ($268.5 for 1,000 cubic metres) totals $1.6 billion.

Gas supplied in April at $485.5 for 1,000 cubic metres costs $1.3 billion; the debt for gas supplied so far in May is $655 million.
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Offline Letsbereal

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Ukraine Must Show Will to Pay Before Gas Talks, Medvedev Says
« Reply #51 on: May 20, 2014, 05:39:57 PM »
Ukraine Must Show Will to Pay Before Gas Talks, Medvedev Says
20 May 2014
, by Ryan Chilcote, Olga Tanas and Henry Meyer (Bloomberg)
http://www.bloomberg.com/news/print/2014-05-20/ukraine-must-show-will-to-pay-before-gas-talks-medvedev-says.html

Excerpt:

Ukraine should settle a substantial part of its natural-gas debt and set a payment schedule before Russia will start price negotiations amid a dispute that may affect Europe, according to Prime Minister Dmitry Medvedev.

“It should be a substantial sum that would clearly indicate their intention to pay their debts,” Medvedev said yesterday in an interview with Bloomberg Television at his residence outside Moscow.

“It can’t be 3%.”

Ukraine depends on its neighbor for about half of its gas and is a key transit route for supplies to the European Union, increasing the stakes in Russia’s worst standoff with the U.S. and the EU since the Cold War.

The allies have accused Russian leader Vladimir Putin of stoking unrest in Ukraine’s easternmost regions before a May 25 presidential election, a claim he has denied.

“We are aware of the current state of the Ukrainian economy,” Medvedev said. “We aren’t saying they have to pay $3.5 billion all at once, but give us a timetable for paying off these debts, especially since Ukraine has just received a tranche from the IMF, and both the Americans and Europeans have promised loans.”

Ukraine is ready to pay $4 billion for gas as long as OAO Gazprom, Russia’s state-run producer and exporter, agrees to lower the price it charges, the Ukrainian Energy Ministry said last week.

The country received the first $3.2 billion from a $17 billion International Monetary Fund aid package this month.
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Offline Letsbereal

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‘Poroshenko has tough road ahead after winning Ukrainian election’ https://www.youtube.com/watch?v=JU8stoWN9dU

25 May 2014, RT
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Offline Letsbereal

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EU Drafts $2.5 Billion Ukraine Gas Debt As Cuts Looms
« Reply #53 on: May 27, 2014, 08:05:05 PM »
EU Drafts $2.5 Billion Ukraine Gas Debt As Cuts Looms
27 May 2014
, by Elena Mazneva, Ewa Krukowska and Olga Tanas (Bloomberg)
http://www.bloomberg.com/news/print/2014-05-26/russia-ukraine-draft-gas-debt-plan-as-price-dispute-unresolved.html

Excerpt:

Russia, Ukraine and the European Union sketched out a tentative deal on part of the transit nation’s gas debt to Moscow-based OAO Gazprom that would help avert gas cutoffs, the European Commission said.

Ukraine’s state energy company, NAK Naftogaz Ukrainy, would pay Russia’s gas exporter $2 billion by May 30 and a further $500 million by June 7, the commission said in a statement after trilateral talks in Berlin yesterday.

The bills will partially cover Ukraine’s outstanding debt for fuel deliveries from November 2013 through May this year, it said.

Ukraine will give its answer on the “proposal for discussion” by the evening of May 28, the country’s Energy Minister Yuri Prodan told reporters in Berlin yesterday.

The draft agreement is subject to approval from the governments in Kiev and Moscow.

Ukraine depends on Russia for about half its gas, making energy a battleground in the wider political struggle between the two countries.

About 15% of Europe’s annual gas demand crosses Ukraine in pipelines from Russia and is vulnerable to disputes between the former Soviet allies.

“Both sides need to talk with their prime minister or president and with their company boards,” EU Energy Commissioner Guenther Oettinger said after the Berlin talks.

“We have set a deadline for an answer that further talks are acceptable by Wednesday evening.”
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Offline Letsbereal

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Russia Tells Kiev "It Is Ready To Provide Humanitarian Aid" To East Ukraine
28 May 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-05-28/russia-tells-kiev-it-ready-provide-humanitarian-aid-east-ukraine
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Offline Letsbereal

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Russia, Ukraine Fail to Agree on Gas Plan as Cut Looms
« Reply #55 on: May 29, 2014, 04:05:30 AM »
Russia, Ukraine Fail to Agree on Gas Plan as Cut Looms
28 May 2014
, by Elena Mazneva (Bloomberg)
http://www.bloomberg.com/news/print/2014-05-28/russia-ukraine-fail-to-agree-on-gas-plan-as-cut-looms.html

Excerpt:

Russia and Ukraine remain at loggerheads over natural gas deliveries after a possible compromise put forward by the European Union to help avoid supply disruptions as soon as next month failed to win support.

Russia is ready to discuss price changes and also may withdraw a demand for advance payments once Ukraine starts paying for deliveries, officials in Moscow said yesterday.

The government in Kiev is prepared to pay up once Russia lowers prices.

“We are ready to pay the market price for gas, but never the political one,” Ukrainian Prime Minister Arseniy Yatsenyuk said yesterday in Berlin.

Ukraine should pay down its debt before further talks are held, Russian President Vladimir Putin said in Moscow.

“This situation cannot continue forever. This is simply not possible and everyone understands this,” he said.

Under the EU plan, announced on May 26 after trilateral talks in Berlin, Ukraine would pay $2 billion of its gas debt by May 30 and $500 million more by June 7.

If OAO Gazprom gets the first tranche, Russia’s gas exporter will agree to continue supplies without prepayment and start price negotiations, according to the EU proposal.

Ukraine’s gas debt will have climbed to $5.2 billion by the June 7 deadline for May supplies, Alexey Miller, head of state-controlled Gazprom, said at a meeting with Putin yesterday.

Russia is also seeking about $1.7 billion in advance payments for June shipments.

That’s due by June 2, and starting from the following day, Ukraine will only get what it pays for, Gazprom said earlier this month.
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Offline Letsbereal

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IMF Un-Credibility Watch: Ukraine Edition
« Reply #56 on: May 29, 2014, 07:05:42 AM »
IMF Un-Credibility Watch: Ukraine Edition
28 May 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-05-28/imf-un-credibility-watch-ukraine-edition

Excerpt:

The IMF has lied (about 'not' proposing a 71% income tax) and has been shown as a serial over-optimistic forecaster (world growth disappointments and hockey sticks) but the simply incredible hope that Christine Lagarde's PhDs created in their growth expectations for Ukraine make their Greece "Oops" moment look like nothing.

As CFR rebukes, we see the IMF’s growth forecasts for Ukraine and Greece not as forecasts at all, but rather as assumptions necessary to justify the IMF’s interventions.

Credibility -> 0.

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Russia Says No Gas Payments From Kiev as of Thursday
« Reply #57 on: June 01, 2014, 12:37:16 PM »
Russia Says No Gas Payments From Kiev as of Thursday
30 May 2014
, Moscow (RIA Novosti)
http://en.ria.ru/russia/20140530/190248276/Russia-Says-No-Gas-Payments-From-Kiev-as-of-Thursday.html

As of Thursday evening, Moscow has not received any gas debt payments from Kiev, Russian Energy Minister Alexander Novak said on Friday.

He reiterated that Russia was not ready to discuss any gas discounts until Kiev repays at least a part of its debt, which may hit $5.2 billion in May.

“Naturally, our position remains unchanged,” Alexander Novak said.

Ukraine’s gas debt to Russia currently stands at $4 billion, according to EU Energy Commissioner Guenther Oettinger. Kiev continues to reject the new price of $485 per thousand cubic meters of Russian gas.

Russia’s energy giant Gazprom earlier announced a switch to a prepayment scheme, in full accordance with the 2009 energy contract between Russia and Ukraine.

Following the decision, an advance bill was sent to Ukrainian state energy company Naftogaz for June deliveries, with supplies to be suspended starting June 3 if the debt is not repaid.

Earlier this week, Ukraine said its oil and gas company, Naftogaz, had hired a Swedish law firm to represent it in court as it prepares litigation against Gazprom over its pricing policy.
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Russia to postpone payment switch for Ukraine gas
« Reply #58 on: June 02, 2014, 12:44:55 PM »
Russia to postpone payment switch for Ukraine gas
2 June 2014
, by Andrey Ostroukh - Moscow (MarketWatch)
http://www.marketwatch.com/story/russia-to-postpone-payment-switch-for-ukraine-gas-2014-06-02

Russia will postpone switching to a system of prepayment for natural gas supplies to Ukraine after receiving a partial repayment from Kiev, Gazprom Chief Executive Officer Alexei Miller said Monday.

The decision comes after talks on Friday between the Russian and Ukrainian energy ministers who indicated that a compromise could be reached in the near term.

Earlier this year Russia had said it would demand prepayment from Ukraine for future gas supplies starting from June unless Kiev begins to pay off a portion of its debt.

Mr. Miller said Monday that the company received $786 million, the amount Ukraine owed for gas supplies in February and March this year and the company will now postpone the deadline for switching to the prepayment scheme for one week until June 9.

Ukraine has to redeem its debt for May deliveries by June 9, Mr. Miller said.

In May Moscow said Kiev had more than $3.5 billion in outstanding bills, and threatened to cut off supplies to Ukraine this Tuesday if Kiev doesn't prepay its bill for June.

Ukraine has partly acknowledged this debt, saying the bill for the past month should be calculated on the old price of $268.5 per 1,000 cubic meters, rather than under an increased April price of $485.50 per 1,000 cubic meters.

Ukraine's Finance Minister Oleksandr Shlapak said last month the country was ready to pay Russia for its previous deliveries immediately, if Gazprom were to keep the gas price for 2014 at the level agreed in late 2013 between Mr. Putin and his ousted Ukrainian counterpart Viktor Yanukovych.
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Offline Letsbereal

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Ukraine Resumes Talks With Gazprom With Supply Cut on Horizon
« Reply #59 on: June 03, 2014, 10:58:26 AM »
Ukraine Resumes Talks With Gazprom With Supply Cut on Horizon
3 June 2014
, by Elena Mazneva and Daryna Krasnolutska (Bloomberg)
http://www.bloomberg.com/news/print/2014-06-03/ukraine-resumes-talks-with-gazprom-with-supply-cut-on-horizon.html

OAO Gazprom, the world’s biggest natural gas producer, is holding negotiations with Ukraine today to resolve a price dispute after postponing a deadline for Kiev to settle its debts or face a supply cutoff to next week.

A Russian gas cutoff is “still on the agenda,” Ukrainian Prime Minister Arseniy Yatsenyuk told lawmakers today in Kiev, saying he hopes an agreement will be reached this week.

Executives from Gazprom and state energy company NAK Naftogaz Ukrainy are meeting in Berlin, he said.

While Russia and Ukraine remain at loggerheads over the annexation of Crimea and increasingly violent separatist movements in eastern Ukraine, Gazprom yesterday gave Naftogaz an extra week before demanding payment upfront.

The European Union, which imports 30% of its gas from Russia, half through Ukraine’s pipelines, is pushing for the former Soviet allies to resolve their dispute to avoid any disruptions.

“We need to reach a deal with Ukraine,” Sergei Kupriyanov, Gazprom’s spokesman, said today in Moscow.

The company must “avoid being spineless,” and at the same time remain “flexible,” he said.

Commercial negotiations with Ukraine will be bilateral, while the European Union will provide political consultations in three-way discussions, Kupriyanov said.

Three-way discussion ended yesterday in Brussels with Russia and Ukraine considering setting a gas price for the next 12 months, according to EU Energy Commissioner Guenther Oettinger.

First Step

The first step should be Ukraine paying $1.45 billion of outstanding debts for the last two months of 2013 and starting settlements for gas received in April and May, Kupriyanov said. Gazprom received $786 million from Ukraine yesterday for February and March supplies.

Ukraine still hasn’t paid for 9.84 billion cubic meters of gas supplies, including more than 3.5 billion cubic meters imported in May, according to Kupriyanov.

The country needs to add 7 billion cubic meters of gas to the 12 billion already stored before the heating season begins, Yatsenyuk said.

Before yesterday’s talks, Gazprom shifted the deadline for Ukraine to either pay its debt or move to advance payments from June 2 to June 9, indicating it may move the deadline again.

In April, Gazprom raised Ukraine’s gas price 81% to $485 per thousand cubic meters, higher than for any EU member, citing a contract signed in 2009 as justification.

Ukraine has refused to pay the higher price, seeking a return of its first-quarter price of $268.50 per 1,000 cubic meters.

“There may be some fluctuation around $268,” Yatsenyuk said today. If the sides don’t agree, Ukraine will stick to its plan of filing a Stockholm arbitration case against Gazprom.

Gazprom’s Kupriyanov declined to disclose a possible price for Ukraine, saying the company is looking for a long-term, comprehensive agreement.

“You say their side is insisting on this price,” he said. “You don’t know what they’re insisting on, because you only know what they say publicly.”
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Offline Letsbereal

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Re: Ukrainian people are in for a rude awakening – Welcome to the West!
« Reply #60 on: June 13, 2014, 11:51:38 AM »
Ukraine PM Warns "Prepare For Russian Gas Cutoff On Monday"
13 June 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-06-13/ukraine-pm-warns-prepare-russian-gas-cutoff-monday

Excerpt:

    UKRAINE PM ORDERS GOVERNMENT, REGIONAL AUTHORITIES TO PREPARE ENERGY SECTOR FOR RUSSIAN GAS CUTS FROM MONDAY

No deal...

    *GAZPROM OFFER OF $385 FOR GAS `NOT A MARKET PRICE': KOBOLYEV

    *GAZPROM NATURAL GAS PRICE FOR UKRAINE SHOULD BE LOWER: KOBOLYEV

    *'NOT BAD' COMPROMISE OFFERED BY EC OF GAS AT $326: KOBOLYEV

    *'WE WANT TO AGREE ON A FAIR PRICE' FOR GAS: NAFTOGAZ CEO


But...

    *NO SET DATE FOR NEXT GAS TALKS WITH GAZPROM: NAFTOGAZ CEO

And so...

    *YATSENYUK ASKS GOVT, NAFTOGAZ TO PREPARE FOR JUNE 16 GAS CUTOFF

As Novinite reports, negotiations are not going well, ...


Laugh Along With Putin https://www.youtube.com/watch?v=8ux3oiWELIQ
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Offline Letsbereal

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Re: Ukrainian people are in for a rude awakening – Welcome to the West!
« Reply #61 on: June 15, 2014, 05:01:27 AM »
Gas Talks Falter as Ukraine Mourns 49 Killed in Attack
15 June 2014
, by Daryna Krasnolutska, Volodymyr Verbyany and Ewa Krukowska (Bloomberg)
http://www.bloomberg.com/news/print/2014-06-15/pro-russia-rebels-down-ukraine-jet-as-fighting-escalates.html

Excerpt:

Talks may resume today to prevent a cutoff by Russia of natural gas flows into Ukraine tomorrow, even as riots broke out near the Russian Embassy in Kiev after separatists shot down a Ukrainian military plane.

Negotiations involving Ukrainian, Russian and European Union officials that started late yesterday were to reconvene at about 9 a.m. in Kiev, EU Energy Commissioner Guenther Oettinger told reporters.

No timetable is set, and OAO Gazprom “doesn’t rule out anything,” Sergei Kupriyanov, a spokesman for the Russian state-run gas company, said by phone today.

Ukraine is observing a national day of mourning for the 40 soldiers and nine crew members on the plane, which was shot down as it approached Luhansk airport in eastern Ukraine early yesterday, authorities including the Kiev-based Prosecutor General’s Office said.

The 49 deaths mark the deadliest strike on Ukrainian forces since pro-Russian unrest in the nation’s two eastern regions began in early April.

Ukrainian protesters gathered near the Russian embassy in Kiev starting at around 4 p.m. yesterday, demanding Russia stop sponsoring the rebels.

Demonstrators threw firecrackers and eggs, broke some of the building’s windows with stones, and turned over and torched at least three embassy cars.

The protest continued past midnight, as Russian Foreign Minister Sergei Lavrov asked Didier Burkhalter, head of the Organization for Security and Co-operation in Europe, to intervene and use “all possible measures” to stem the violence.

In a statement, Lavrov said Ukraine authorities did nothing to stop the attack.
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Offline Letsbereal

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Russia Rejects Ukraine's Gas Deal; 2am Eastern Deadline Looms
« Reply #62 on: June 15, 2014, 08:21:54 PM »
Russia Rejects Ukraine's Gas Deal; 2am Eastern Deadline Looms
15 June 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-06-15/russia-rejects-europes-gas-deal-2amet-deadline-looms

Excerpt:

As suspected given the huge distance between the bid and offer, the EU-brokered Ukraine-Russia gas deal has failed:

    GAZPROM CEO MILLER LEAVES SITE OF UKRAINE GAS TALKS

    GAZPROM SAYS TALKS ENDED, DEADLINE WON'T CHANGE (negotiate that!)

    RUSSIA REJECTED EU'S GAS PROPOSAL: OETTINGER

    UKRAINE WAS READY TO ACCEPT EU PROPOSAL ($300-$385): PRODAN (lol!!)


Gazprom seeks $1.95bn from Ukraine for past shipments of gas by the 10am Moscow time deadline (2amET) and will continue to seek upfront payments for any further shipments.
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Offline Letsbereal

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Russia Halts Gas Supplies To Ukraine
« Reply #63 on: June 16, 2014, 12:45:11 PM »
Russia Halts Gas Supplies To Ukraine
16 June 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-06-16/russia-halts-gas-supplies-ukraine

Excerpt:

After weeks of worthless foreplay whose outcome was known from the beginning despite just as worthless EU middleman Oettinger assuring everyone a deal was imminent any second now, overnight we got the long-anticipated mutual defection outcome and - as we warned - negotiations between Gazprom and Ukraine/EU fell apart with the Russian energy giant halting supplies to Ukraine unless Kiev prepays any and all gas deliveries from now on.

Gazprom said it hadn't received payment for a debt it put at $4.458 billion by the Monday deadline it had set. "Ukraine will receive gas only in the amounts it has paid for," Gazprom said.

The reason for the collapse in talks: Kiev wants to pay $268.5 per 1,000 cubic meters of gas - the price it had been offered when Yanukovich was in power - but, in a compromise last week, said it would agree to pay $326 for an interim period until a lasting deal was reached.

Moscow had sought to keep the price at the 2009 contract level of $485 per 1,000 cubic meters, but had offered to waive an export duty, bringing down prices by about one-fifth to $385, which brings it broadly into line with what Russia charges other European countries.

In other words, the delta was less than $60, and certainly a "fair" offer to Ukraine considering it is what Europe pays.

However, it wasn't low enough for Kiev, which certainly is out of money once again having to spend the bulk of its IMF/EU aid to keep its military armed, and the only logical outcome - one in which the country would no longer receive something for nothing - transpired.

This hardly will be surprising to anyone: moments ago Gazprom CEO Miller added that Ukraine is unable to pay for its gas obligations in arrears, something the Ukraine side had confirmed previously when Miller added Kiev had been pumping Russian gas in its underground storage facilities at a blistering pace preparing for just this eventuality.

End result, a few hours ago, Gazprom made the following announcement:

"Today, from 10:00 a.m. Moscow time, Gazprom, according to the existing contract, moved Naftogaz to prepayment for gas supplies ... Starting today, the Ukrainian company will only get the Russian gas it has paid for."

Gazprom also warned EU on "possible gas transit risks", meaning since all the gas sent to Europe transits Ukraine, it was quite possible Kiev would simply continue to siphon off Russian gas without paying for it.

The problem there, however, is that the parties impacted would be Ukraine's BFFs: Germany, central Europe, and, of course, the UK.

And what better way to sow discord among otherwise bosom friends than have them start fighting for Russia's energy scraps...

And now the question: how long before Ukraine's alleged 14 BCM in gas held in storage runs out and Kremlin once again has all the leverage.

According to simple estimates, a few months at most, and certainly just in time for Ukraine's winter.
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Ukraine Negotiating for EU Gas Supplies After Russia Cuts
« Reply #64 on: June 17, 2014, 05:51:52 PM »
Ukraine Negotiating for EU Gas Supplies After Russia Cuts
17 June 2014
, by Kateryna Choursina, Daryna Krasnolutska and Daria Marchak (Bloomberg)
http://www.bloomberg.com/news/print/2014-06-17/ukraine-negotiating-for-eu-gas-supplies-after-russia-cuts.html

Excerpt:

Ukraine is sending a delegation for talks with European Union officials to negotiate natural gas supplies after Russia cut off deliveries as government troops battled separatist rebels overnight.

“Ukraine can get 15 billion cubic meters of gas from the EU,” Ukrainian Prime Minister Arseniy Yatsenyuk said today in parliament in Kiev.

“The Russian president says he is against reversed flows, and we are very much against monopolization, against economic and energy discrimination.”

Ukraine said yesterday that Russia cut gas after demanding advance payments, the first time shipments have been affected in the current crisis between the countries.

Ukraine must pay its debt and will only get gas paid for up front, OAO Gazprom (GAZP) Chief Executive Officer Alexey Miller said.

Gazprom supplies a third of EU gas, 15 percent of which flows through Ukraine.

“These are European gas companies that have their own gas and are ready to deliver it to Ukraine,” Andriy Kobolyev, head of Ukraine’s gas monopoly NAK Naftogaz Ukrainy, is cited as saying in an e-mailed government statement late yesterday.

Kobolyev said Ukraine may be offered gas at $320 per 1,000 cubic meters -- less than the $385 that Gazprom demands Naftogaz pay.

Naftogaz is already working with France’s GDF Suez (GSZ) and Germany’s RWE AG (RWE) and has “proposals” from another major energy company, Kobolyev said, according to the statement.

Yatsenyuk said a delegation is leaving today for talks with EU officials on reversing gas flows from western Europe to Ukraine.

Naftogaz spokeswoman Alyona Osmolovska said talks will be held in Budapest tomorrow during an energy conference.

The price of Ukraine’s $2.6 billion of bonds due July 2017 climbed for the first time in six days, pushing the yield two basis points lower to 10.11%.

The yield jumped 69 basis points yesterday.
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Offline Letsbereal

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Ukrainian President Moves to Oust Central Bank Chief
« Reply #65 on: June 18, 2014, 08:51:37 AM »
Ukrainian President Moves to Oust Central Bank Chief
18 June 2014
, by Daryna Krasnolutska and Kateryna Choursina (Bloomberg)
http://www.bloomberg.com/news/print/2014-06-18/ukrainian-president-moves-to-oust-central-bank-chief.html

Ukrainian President Petro Poroshenko moved to assert his power, picking a new central bank chief, foreign minister and chief prosecutor.

Poroshenko, who took office less than two weeks ago, nominated Valeriya Gontareva to replace Stepan Kubiv as the head of the monetary authority, Pavlo Klimkin to succeed Andriy Deshchytsia as the country’s chief diplomat and Vitali Yarema to take over from Oleh Makhnitsky to lead the prosecutor’s office, according to parliament’s website.

There’s no date set for lawmakers to vote on the proposals.

Gontareva, 49, is set to become the first woman to run the central bank after serving as the chairman of Kiev-based Investment Capital Ukraine.

She would replace Kubiv, 52, who was picked by parliament in February for seven years after three-months of deadly protests ousted Kremlin-backed President Viktor Yanukovych. Poroshenko did not provide reasons for changes.

She will share stewardship of an imploding economy and a financial system under pressure as government forces battle separatist unrest in the country’s easternmost regions.

Ukraine is relying on a $17 billion bailout loan to stay afloat after the hryvnia plunged 31% against the dollar, while the nation’s biggest 22 lenders may require fresh capital of as much as 5% of GDP.

Klimkin will take over the Foreign Ministry after the outgoing chief riled Russian diplomats by using derogatory language to refer to Russian President Vladimir Putin.
‘Right Direction’

Poroshenko “is taking steps in the right direction to gain power and to get more leeway in domestic and foreign policy,” Stefan Meister, a Berlin-based analyst at the European Council on Foreign Relations, said by phone.

“It looks good for the time being, or better than before.”

Ukraine’s government bonds due 2023 rose for the first time since June 9, pushing the yield down to 9.012%, data compiled by Bloomberg show.

The hryvnia declined to 11.965 per dollar as of 2:45 p.m. from 11.94 yesterday.

Gontareva is “knowledgeable, experienced banker with commercial background,” said Vladislav Sochinsky, the treasurer at Citigroup Inc.’s unit in Kiev.

“But we already have the third central bank head in just four months, while this is seven-year position.”

Aside from the central bank governor, foreign minister and prosecutor general, Ukraine’s president also has the right to pick the head of the state security service and the defense minister.
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Offline Letsbereal

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Re: Ukrainian people are in for a rude awakening – Welcome to the West!
« Reply #66 on: June 18, 2014, 10:27:30 AM »
Ukraine Facing Backlash From FX Borrowers Sunk by Hryvnia
18 June 2014
, by Daryna Krasnolutska and Daria Marchak (Bloomberg)
http://www.bloomberg.com/news/print/2014-06-17/ukraine-facing-backlash-from-fx-borrowers-sunk-by-hryvnia.html

As central Kiev burned amid deadly street protests in February, Ukraine’s currency dived and Alex Bukovetskiy stopped paying his dollar-based mortgage.

The 41-year-old joined hundreds of angry borrowers at parliament last week to demand the authorities provide relief after the hryvnia lost a third of its value in two months.

Payments to Universal Bank on his flat in the capital’s suburbs have jumped 40% to $1,250 since President Viktor Yanukovych was toppled.

“I don’t have that kind of money,” Bukovetskiy, who’d been dipping into savings to pay his mortgage after losing his marketing job last autumn, said June 5 by phone.

“I’m not hiding from my bank. I’m ready to pay but I want a compromise.”

Six months of political turmoil have rocked Ukraine’s finances, turning the hryvnia into 2014’s worst performer versus the dollar and prompting the government to sign a $17 billion bailout with the International Monetary Fund.

Already battling an insurgency in the nation’s east, officials must now decide between placating the borrowers and further undermining the nation’s fiscal position or antagonizing them by doing nothing.

The situation could be worse: Ukrainian banks, which include Dnipropetrovsk-based Privatbank, Russian lenders such as OAO Sberbank (SBER) and foreign institutions such as Raiffeisen Bank International AG (RBI), have been limited to issuing hryvnia-based home loans since the 2008 financial crisis ravaged the economy.
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Offline Letsbereal

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Re: Ukrainian people are in for a rude awakening – Welcome to the West!
« Reply #67 on: June 19, 2014, 02:44:35 PM »
As Ukraine Launches A Debt Restructuring, Is Russia About To Become A "Holdout" Activist Investor?
19 June 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-06-19/ukraine-launches-debt-restructuring-russia-about-become-holdout-activist-investor
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Offline Letsbereal

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Re: Ukrainian people are in for a rude awakening – Welcome to the West!
« Reply #68 on: June 23, 2014, 06:55:30 PM »
Russia Says Ukraine Took Gas Despite Cutoff; Sends More Tanks/Troops To Border
23 June 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-06-23/russia-says-ukraine-took-gas-despite-cutoff-sends-more-tankstroops-border

Excerpt:

The deadline passed on June 16th for Ukraine's payment for gas already provided and upfront 'pre-payments' for ongoing deliveries.

So what the Russian Energy Minister wants to know is how Ukraine took 3.8mcm on June 19th, 4.5mcm on June 20th, and 1mcm on June 21st.

It appears Ukraine is claiming the gas supplies are reverse flow from Europe but this has not stopped Russia as The Pentagon reports more Russian troops at the Ukraine border and that they are preparing to send more tanks.

Since the cutoff on June 16th, Ukraine has 'taken':

3.8mcm on June 19
4.5mcm June 20
1mcm on June 21
According to Russia's energy minister.

As it appears Russia sends gas to Europe (via Ukraine) and Ukraine holds on to it - claiming it is "reverse flow."
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Putin Asks Lawmakers to Revoke Right to Use Force in Ukraine
« Reply #69 on: June 24, 2014, 09:01:59 AM »
Putin Asks Lawmakers to Revoke Right to Use Force in Ukraine
24 june 2014
, by Henry Meyer (Bloomberg)
http://www.bloomberg.com/news/print/2014-06-24/putin-asks-lawmakers-to-rescind-right-to-use-force-in-ukraine.html

Russian President Vladimir Putin asked lawmakers in the upper house of parliament to rescind approval they granted to use force in Ukraine in a conciliatory gesture before his trip to Europe.

The request was made before Putin’s visit to Vienna today to help stabilize the situation in Ukraine after peace talks began, Dmitry Peskov, Putin’s spokesman, said by telephone.

The Federation Council authorized Putin on March 1 to use the military in Ukraine, before the annexation of Crimea.

Putin’s request is the strongest indication yet that tensions in east Ukraine are abating after the worst diplomatic crisis between Russia, U.S. and its European allies since the end of the Cold War.

Pro-Russian rebels in eastern Ukraine last night called a cease-fire in fighting against government forces, matching a truce announced four days ago by Ukrainian President Petro Poroshenko.

“Putin is trying to achieve a breakthrough and start a real negotiating process,” said Sergei Markov, a Moscow-based political analyst who’s a consultant to Putin’s staff.

“Now we have to see how the government in Kiev will respond. Are they willing to hold serious talks?”

Markets Rally

Rebel leaders agreed yesterday to join a one-week cease-fire announced by Ukrainian President Petro Poroshenko on June 20.

That prompted a rally in Russian and Ukrainian assets.

The Micex Index (INDEXCF) jumped to an intraday high, rising 1.3% to 1,504.94 by 2:38 p.m. in Moscow, while the ruble extended gains, adding 0.7% to 39.3922 versus the basket.

The decision was at least partly driven by a desire to drive off potential sanctions by the U.S. and European Union, Masha Lipman, an analyst at the Moscow Carnegie Center, said by telephone.

Even so, Putin will maintain his efforts to keep Ukraine within Russia’s sphere of influence, she said.

“It’s not clear whether Putin ever meant to invade, but the West isn’t capable of changing Putin’s priorities,” Lipman said.

“He’s not interested in Ukraine moving toward normalcy, he’s interested in keeping it weak.”
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Ukraine With Few Months Gas Store Needs Russia Deal: BofA
« Reply #70 on: June 25, 2014, 06:08:11 PM »
Ukraine With Few Months Gas Store Needs Russia Deal: BofA
25 June 2014
, by Isis Almeida (Bloomberg)
http://www.bloomberg.com/news/print/2014-06-25/ukraine-with-few-months-gas-store-needs-russia-deal-bofa.html

Ukraine has “a few months” of natural gas reserves, meaning it will have to sign an agreement on prices with Russia to guarantee supplies during the winter, according to Bank of America Corp.

Gas inventories in Ukraine are currently about 15 billion cubic meters (530 billion cubic feet), more than half of the country’s annual imports, Vadim Khramov, a Ukraine economist at the bank, said today at a press conference in London.

Ukraine will try to source more gas from Europe if no agreement with Russia’s OAO Gazprom is reached in the next three to four months and may eventually be forced to sign a deal, he said.

Russia cut supplies to Ukraine, which carries about 15% of Europe’s gas needs through its pipes, after a June 16 payment deadline expired, echoing disputes that disrupted flows to the region in 2006 and 2009.

Ukraine owes Gazprom more than $4.4 billion for fuel deliveries in November, December, April and May, according to the Russian state-run company.

“Ukraine has gas for a few months,” Khramov said today in an interview. Without Russian gas, the country will need to “look for other solutions within the next three months.”

Russia raised gas prices for Ukraine by 81 percent to $485 per 1,000 cubic meters in April by canceling previous rebates.

While Gazprom offered to lower prices by $100, Ukraine rebuffed the proposal, saying it was prepared to pay $326, a compromise proposed by the European Union.

The bloc has been trying to broker a deal between the two nations since May 2.

Any price below $400 per 1,000 cubic meters is a “good deal” for Ukraine as Russia charges European buyers about $380 per 1,000 cubic meters, Khramov said.

Conflict Effect

Ukraine needs six billion cubic meters of gas to keep pressure on its transit pipes that carry Russian fuel to Europe, according to Khramov.

The nation consumes about 1.7 billion cubic meters a month in summer, he said.

A conflict in the eastern regions, where most of the country’s industry is located, might mean demand is even lower, at about 1.5 billion cubic meters a month, Khramov said.

Consumption will rise during winter and supplies from the EU via so-called reverse flows won’t suffice, he said. In the long term, Ukraine will need to cut its energy consumption, he said.

Militants in Ukraine, seeking closer ties with Russia, have continued to attack government forces, defying a week-long cease-fire supported by both Russian President Vladimir Putin and rebel leaders.

Ukraine can get gas from neighboring countries including Poland and Slovakia by reversing flows from west to east.

RWE AG, Germany’s second-biggest utility, started delivering gas to Ukraine from Poland in April.
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Offline Letsbereal

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Re: Ukrainian people are in for a rude awakening – Welcome to the West!
« Reply #71 on: June 25, 2014, 09:54:39 PM »
To make this point clear, what we see happening here is that Germany is buying gas from Gazprom to sell it for a profit or not to the fascistic W-Ukraine part.

RWE AG, Germany’s second-biggest utility, started delivering gas to Ukraine from Poland in April.”

EU Gas Buyers Got Up to 20% Off From Gazprom: Cedigaz http://www.bloomberg.com/news/print/2014-06-24/eu-gas-buyers-got-up-to-20-off-from-gazprom-cedigaz.html

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Offline Letsbereal

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Ukrainian Gas Debts: Kremlin Pressure, Kiev's Reluctance to Pay, or US Game? https://www.youtube.com/watch?v=xCbbs2BmpcQ

25 June 2014, GlobalResearchTV

The Russian energy corporation, Gazprom, cut off its gas supplies to Ukraine, after a deadline passed for Kiev to repay $1.95 billion (£1.15 billion; €1.44 billion) which the Russian Federation is owed.

Speaking at a June 16, 2014 press conference in Moscow, Gazprom chief executive Alexei Miller said Ukraine's state-owned Naftogaz company would from now on have to pay upfront for its gas - but supplies to its European partners would continue.

The regime in Kiev has artificially created the gas crisis with the support of the US government. Press TV interviews Mahdi Darius Nazemroaya to ask about the position that Gazprom and the Russian government have take in regards to Kiev's refusal to pay its bills.
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Offline Letsbereal

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Re: Ukrainian people are in for a rude awakening – Welcome to the West!
« Reply #73 on: June 27, 2014, 08:34:58 PM »
To make this point clear, what we see happening here is that Germany is buying gas from Gazprom to sell it for a profit or not to the fascistic W-Ukraine part.

RWE AG, Germany’s second-biggest utility, started delivering gas to Ukraine from Poland in April.”

EU Gas Buyers Got Up to 20% Off From Gazprom: Cedigaz http://www.bloomberg.com/news/print/2014-06-24/eu-gas-buyers-got-up-to-20-off-from-gazprom-cedigaz.html

Russia "Not Optimistic" After EU Peace Talks; Threatens To Limit Reselling Gas To Ukraine
27 June 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-06-27/russia-not-optimistic-after-eu-peace-talks-threatens-limit-reselling-gas-ukraine

With Petroshenko agreeing to extend today's cease-fire deadline for 3 days, the Russians, unfortunately, are not optimistic after the 'expert-level' talks in Europe.

Given this, it appears Russia is preparing its retaliation for possible further sanctions that are being waved by Europe and the US.

As AP reports, Russia's state-controlled gas company, Gazprom, says it could limit supplies to European customers that intend to re-sell the natural gas on to Ukraine.

While not naming specific countries, the Gazprom CEO explained he needed to clamp down on the so-called reverse-flow supplies the the cut-off Ukraine as they were "half-fraudulent schemes."

Russia not optimistic...

*RUSSIA NOT OPTIMISTIC AFTER EXPERT-LEVEL EU TALKS JUST ENDED

*RUSSIA EXPECTS CONSTRUCTIVE APPROACH FROM EU, UKRAINE


And appear to be preparing for sanctions...

*GAZPROM MAY LIMIT EU COS. SENDING GAS IN REVERSE GAS TO UKRAINE

Russia's state-controlled gas company, Gazprom, says it could limit supplies to European customers that intend to re-sell the natural gas on to Ukraine.

Gazprom's CEO Alexei Miller said Friday that the company is closely monitoring the situation and may curb shipments to European nations that would pump the Russian gas to Ukraine in the so-called reverse supplies, which he has described as a "half-fraudulent scheme."

He wouldn't name any specific countries.

Gazprom this month cut gas shipments to Ukraine amid a debt and pricing dispute.

Supplies to Europe via Ukraine and other pipelines haven't been affected, however. Ukraine has sought to counter the Russian move by trying to negotiate gas supplies from other European countries that buy Russian gas.

And if the West thinks sanctions will slow them down... think again...

*GAZPROM TO REPLACE CENTRAL ASIAN GAS SUPPLIES WITH RUSSIAN FUEL

*GAZPROM, CHINA TO SIGN CONTRACT ON ADDITIONAL 30BCM/YR OF GAS


So D-Day is now Tuesday...
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Offline Letsbereal

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Gazprom says gas transit via Ukraine may be stopped completely
« Reply #74 on: June 28, 2014, 10:38:59 AM »
Gazprom says gas transit via Ukraine may be stopped completely
27 June 2014
, Moscow (ITAR-TASS).
http://en.itar-tass.com/economy/738060

Gazprom has started pumping gas into European gas storage facilities and it plans to pump 5 billion cubic meters

Russia’s gas giant Gazprom does not rule out gas transit via Ukraine may be stopped completely.

“What happened once is a tendency, nothing happens incidentally.

In 2009, gas supplies were stopped completely — so, we know precedents,” Gazprom CEO Alexei Miller told a briefing on Friday.

Ukainian gas transportation system

Gazprom not interested in participation in Ukraine’s gas transportation system (GTS), “train has departed”, CEO said.

“The train has already departed. It seems it departed yesterday,” Miller said.

“It belongs to no one. The GTS has no owner,” he said.

“The GTS of Ukraine does not belong to Naftogaz but to the Ukrainian government.

Before discussing things with someone regarding modernization and cooperation, it should appear on the balance sheet of this or that economic entity.”

“Property and legal issues should be resolved first,” Miller said.

The Gazprom chief added that “a dozen Ukrainian laws need to be changed to be able to do something with the GTS.”

“As for the continuation of negotiations with Ukraine, today there is no subject for talks. First, they must repay their debts,”  Alexei Miler said.

“The gas price for Ukraine is fair - this price is fixed in the contract,” he stressed.

There have been no requests on the part of Ukraine’s national oil and gas company Naftogaz Ukrainy on a change of the transit deal with Russia, Alexei Miller said.

Miller told journalists that it would be bad news if such requests had been received.

Gazprom has started pumping gas into European gas storage facilities and it plans to pump 5 billion cubic meters, Gazprom CEO Alexei Miller said Friday.

The remainder now stands at 2.6 billion cubic meters, Miller said.

“The assessment on the maximum daily withdrawal from European underground storages that we can ensure is 54-55 million cubic meters,” he said.

Miller stressed that pumping of gas into storages will not “fully remove transit risks for Ukraine“.

The company does not rule out that it could limit gas supplies to European companies involved in gas reverse to Ukraine, Gazprom CEO Alexei Miller said Friday.

“There’s no physical reverse,” he said. “If we register reverse at Europe’s gas measuring stations, we will probably introduce limitations.


South Stream gas project

No changes can be made to the intergovernmental agreement on the South Stream gas project, Gazprom CEO Alexei Miller has said.

"One should understand that an international treaty prioritises internal legislation not only legislation of certain countries, but also of economic unions such as the European Union," Miller told a news briefing on Friday.

He referred to the 1969 Vienna Convention on the Law of Treaties.

The agreements on the South Stream project cannot be denounced unilaterally, he said.

Gazprom hopes to have opportunities to replace Central Asian gas by yearend, Alexei Miller added.
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Offline Letsbereal

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Austria defies US, EU over South Stream during Putin visit
« Reply #75 on: June 28, 2014, 10:45:30 AM »
Austria defies US, EU over South Stream during Putin visit
24 June 2014
, (DW)
http://www.dw.de/austria-defies-us-eu-over-south-stream-during-putin-visit/a-17734602

Austria's OMV and Russia's Gazprom have signed a deal for the Austrian section of the controversial South Stream gas pipeline that bypasses Ukraine. Austria's president, Heinz Fischer, has rejected US and EU criticism.

Austrian energy company OMV and Russia's Gazprom signed a contract on Tuesday for the construction of the South Stream pipeline's Austrian section.

It came just hours before Russian President Vladimir Putin arrived in Vienna for a one-day visit.

While OMV general director Gerhard Roiss said the South Stream pipeline would "ensure energy security for Europe, particularly for Austria," the US embassy in Vienna launched a thinly veiled attack on the move.

In a statement, it said that trans-Atlantic unity had been essential in "discouraging further Russian aggression" and that the Austrians "should consider carefully whether today's events contribute to that effort."

In a meeting with Austrian president Heinz Fischer, Putin slammed the criticism by saying that "our American friends... want to supply Europe with gas themselves. They do everything to derail this contract..."

Fischer also defended the project, stating that "no one can tell me why... a gas pipeline that crosses NATO and EU states can't touch 50 kilometers (31 miles) of Austrian territory."

Putin and Fischer also emphasized Russia's and Austria's close business ties, with Putin calling Austria an "important and reliable" partner. Austria was the first western European country to sign, in 1968, long-term gas supply deals with Moscow.

Russia is Austria's third-biggest non-EU trading partner after the United States and Switzerland.

While Austria is a member of the EU and should, therefore, endorse the bloc's visa bans and asset freezes against Russia, Fischer said on Tuesday that he opposed sanctions against Moscow.

But he also told Putin Moscow's annexation of Crimea violated international law.

US, EU concerns

South Stream, which will cost an estimated $40 billion (€29.4 billion), is designed to carry Russian gas to the center of Europe. Russia currently supplies a third of Europe's gas.

The pipeline bypasses the current transit route through Ukraine and would make Europe even more dependent on Russian gas, critics say.

The EU Commission says South Stream as it stands does not comply with EU competition law because it offers no access to third parties.

The EU also objects to the fact that Gazprom will control both the pipeline itself and the gas supply.

The pipeline will stretch across Russia, under the Black Sea and then through Bulgaria, Serbia, Hungary and Slovenia to Austria.

Gazprom's partners for the offshore part of the project are Italy's ENI, Germany's Wintershall Holding and France's EDF.

ng/lw (AP, Reuters, AFP)
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Offline Letsbereal

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Russia Reveals "Plan B": Gazprom Says Gas Transit Via Ukraine May Be Stopped Completely
30 June 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-06-30/russia-reveals-plan-b-gazprom-says-gas-transit-ukraine-may-be-stopped-completely
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Offline Letsbereal

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Russia Warns Of "Gas Crisis" By Fall
« Reply #77 on: July 02, 2014, 09:54:41 PM »
Russia Warns Of "Gas Crisis" By Fall, Blasts Poroshenko "Personally Responsible For New Deaths"
2 July 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-07-02/russia-warns-gas-crisis-fall-blasts-poroshenko-personally-responsible-new-deaths
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Offline Letsbereal

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Russia Rushes To Seal Ukraine-Bypassing Gas Pipeline
« Reply #78 on: July 07, 2014, 05:21:17 PM »
Russia Rushes To Seal Ukraine-Bypassing Gas Pipeline: Lavrov Pays Bulgaria A Visit
7 July 2014
, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/2014-07-07/russia-rushes-seal-south-stream-pipeline-lavrov-pays-bulgaria-visit

As we remarked two weeks ago, when observing the recent developments surrounding the suddenly all-important South Stream gas pipeline bypassing Ukraine entirely, and instead traversing the Black Sea before crossing Bulgaria, Serbia, Hungary and terminating in the Austrian central European gas hub of Baumgarten, we said that all of Europe is suddenly focused on if and how Russia will make headway with a project that may be the most important one for not only Europe's energy future but the impact Russia will continue to have over Germany et al.

And of course, Ukraine. Because should Russia find a way to completely bypass Kiev as a traditional transit hub for Russian gas, it would make the country, and its ongoing civil war, completely irrelevant not only for Russia, but worse, for Europe, the IMF, and Ukraine's staunch western "supporters and allies" as well.



Showing just how Europe perceives the Russian "South Stream" threat was a comment from a recent NYT article, in which Günther Oettinger, Europe’s top energy official, was quoted as saying that the Ukraine crisis “has slowed down our progress on South Stream considerably...

We can’t just give in to the Russians every time.” Alas, since the Russians control the all important gas, Europe has zero choice.

This explains why even as the western media finally remembered over the weekend there was a Ukraine civil war going on following an advance by the Kiev army to retake some rebel strongholds in the Donbas region, with some wondering what if anything Putin would do in retaliation,

what Putin, or rather his envoy Sergei Lavrov were actually doing, was completely ignoring the Ukraine situation (where the West has long since conceded the loss of Crimea to the Kremlin) and instead focusing on securing the successful launch of the South Stream (remember: the second South Stream goes online, Ukraine becomes irrelevant).

And since Russia already signed another historic agreement with Austria in June, which positioned the AAA-country (with some surprising emerging bank troubles subsequently) squarely against its fellow European peers, it was the turn of the other South Stream countries, namely Bulgaria.

As Reuters reported, all construction timelines for the South Stream pipeline are on track and the European Union should restart talks about the project, Russian Foreign Minister Sergei Lavrov said on a visit to Bulgaria on Monday.   

Bulgaria has been an enthusiastic supporter of the Russian-backed project, whose construction has stoked tensions between the West and Moscow, especially in the wake of Russia's annexation of Crimea.

But Prime Minister Plamen Oresharski's government suspended work last month on its section of the pipeline at the behest of Brussels, pending a ruling on whether the project violates EU law.


Which maybe sheds some light on why in June Bulgaria also experienced the biggest bank run in 17 years, culminating with the nationalization of the 4th largest bank, and also led to the president announcing his early resignation.

So in the Bulgarian power vacuum, the domestic foreign minister Kristian Vigenin said that the "pipeline is of interest to EU, its construction must comply with European laws" during a briefing with his Russian counterpart, Sergei Lavrov.

He also said that Bulgaria seeks a quick resumption of South Stream, something which means Europe will have to try harder in its try to prevent a pipeline bypassing its now very substantial Ukraine investment. 

Lavrov added that South Stream agreements were signed long ago, before EU adopted unbundling legislation; such laws can’t be retroactively applied.

The Russian foreign minister said Russia expects EU to apply single standards to all pipelines.

And since it is not just Bulgaria but Serbia, we also got this:

RUSSIA, SERBIA MAY SIGN SOUTH STREAM PACT IN DAYS: MEDVEDEV

And from Itar-Tass:

Gas can run through Kosovo by the South Stream pipeline, according to materials, timed to Serbian Prime Minister Aleksandar Vucic’s visit to Russia.

“An issue is being studied to create a network in Kosovo based on long-term contracts on Russian natural gas supplies,” the materials say.

Two branches are planning to be built - to Serbian Republic and Croatia, the materials say.

At present, Russia’s-led South Stream gas branch is expected to run through Macedonia. The Serbian leadership upheld this idea.

South Stream is Gazprom’s global infrastructure project for the construction of a gas pipeline that will run via the bottom of the Black Sea to the countries of Southern and Central Europe with an aim to diversify routes for exporting natural gas and exclude transit risks.

The ground section of the South Stream pipeline will run across Bulgaria, Serbia, Hungary, Slovenia, and Austria.

The designed capacity of the pipeline is 63 billion cubic metres. The pipeline is planned to be commissioned in late 2015.


In other words, the great cold war 2.0 fight for Russian sphere of influence in Eastern Europe is on.

Because while on one hand we reported that during the weekend, it was none other than France which vocally came out against US Dollar hegemony and thus was forced to gravitate toward the Eurasian (China/Russian) camp, it is the events in Eastern Europe in the next several months that will define European energy geopolitics for the decades to come.

Look for many more fireworks in Bulgaria and the other South Stream countries over the coming weeks as the fate of the South Stream is determined behind the scenes.
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Offline Letsbereal

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Ukraine-Europe Gas Link to Run at Capacity This Summer
« Reply #79 on: July 08, 2014, 08:05:23 PM »
Ukraine-Europe Gas Link to Run at Capacity This Summer
8 July 2014
, by Ladka Bauerova (Bloomberg)
http://www.bloomberg.com/news/print/2014-07-07/ukraine-europe-gas-link-set-to-run-at-full-capacity-this-winter.html

A pipeline allowing Ukraine to import gas from Europe will start running at full capacity in September, providing vital fuel supplies as winter approaches with the prospect of no shipments from Russia.

The Vojany pipeline from Slovakia has been booked to ship 10 billion cubic meters a year until 2019, or about 20% of Ukraine’s demand, said Tomas Marecek, chairman of the link’s operator, Eustream AS.

Ukrainian utility NAK Naftogaz booked the majority of the pipeline’s capacity for the five-year period, while the rest was reserved by European utilities, he said.

Vojany, unused for about 15 years, will be crucial this winter after Russia stopped exporting gas to Ukraine last month in a dispute over unpaid bills.

Together with smaller pipelines from Hungary and Poland, Ukraine can import about 16.5 billion cubic meters a year from the European Union, Marecek said.

That replaces about two-thirds of the fuel coming from Russia, and by reducing consumption and using underground storage, Ukraine stands a chance of lasting through the winter, he said.

“However things are not fully under the control of Ukraine,” Marecek said in an interview in Prague yesterday. “The weather will play a major role as well.”

Reverse Mode

While Ukraine would like even more gas from Europe, Slovakia, where the majority of Russian gas enters the EU, can’t increase reverse flows into Ukraine further without violating the existing contract with OAO Gazprom, the Moscow-based export monopoly, Marecek said.

Under agreements between Eustream and Gazprom, no changes in gas use can be made before the commodity reaches the main import station in Slovakia about 7 kilometers (5 miles) past the Slovak-Ukraine border.

Eustream will spend as much as €20 million ($27 million) to prepare Vojany for reverse flow mode.

The pipeline was built in the 1990s to supply a gas-fired power station that never started production.

“The European Commission pressured us, so we found a compromise solution,” Marecek said.

“Using the Vojany pipeline is compatible with the EU energy laws and at the same time doesn’t violate any of Eustream’s existing contracts.

We had it confirmed by both the EU and Russian Foreign Minister Lavrov.”

Ukraine hasn’t received any Russian gas since June 16, when Gazprom cut off deliveries after the two sides failed to reach an agreement on future prices and debt repayment.

Gazprom raised the price for Ukraine to $485 per 1,000 cubic meters in April following the ouster of pro-Russian President Viktor Yanukovych and Russia’s annexation of Crimea.

Reduce Use

Ukraine, which consumes more than 50 billion cubic meters of gas a year, will need to reduce its use by 20% if Russia doesn’t start supplying again, Naftogaz Chief Executive officer Andriy Kobolyev said on July 4.

During the first few months of operation, there’s a risk that Vojany won’t be able to run at full capacity should the flow of transit gas from Russia to Europe through Ukraine get interrupted, Marecek said.

During September, Vojany’s flow will be “interruptible,” which means no gas will flow if Russia interrupts supplies to the EU.

Starting Oct. 1, the pipeline will offer a firm capacity of 6.5 billion cubic meters a year, while the remaining 3.5 billion will remain interruptible until March 1.

Vojany’s full capacity will become available at all times only at the end of next winter, he said.

Ukraine transports about 176 million cubic meters of gas to EU countries through its pipeline network connected with Slovakia, Romania, Hungary, Poland and Moldova.

The Slovak pipeline carries around 95 million cubic meters a day.

Russia decreased gas transit via Ukraine in June by 17% from a year earlier to 5.9 billion cubic meters, UkrTransGas, the national pipeline operator, said today.
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