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Medvedev and Yanukovych agree on fleet and gas

The Ukrainian government plans to suggest a review of the Russian-Ukrainian gas contract, which provides for a quarterly change in Ukraine's gas price, Ukrainian Prime Minister Mykola Azarov said on Wednesday.

On January 19, 2009, Ukraine's Naftogaz and Russia's Gazprom signed a deal to end the New Year gas dispute, which caused a temporary lull in energy supplies to Europe amid freezing temperatures. Under the deal, Ukraine received a 20%-discount on the European gas price.

The pact also stipulated that Ukraine start paying European-level prices for Russian gas in 2010. Under the deal, the gas price directly correlates with the oil price.

"We set a goal to review an extremely disadvantageous gas contract for Ukraine and to persuade our Russian partners of the necessity of reviewing it," Azarov said.

The Ukrainian premier said the current contract was "enslaving" Ukraine.

In April Russian President Dmitry Medvedev and his Ukrainian counterpart Viktor Yanukovych agreed during their meeting in Kharkov in east Ukraine that Russia would grant Ukraine a 30% discount on the gas price of $330 per 1,000 cu m over the next ten years.

If the Kharkov agreement had not been signed, Ukraine would be on the brink of economic collapse, Azarov said.

 KIEV, August 25 (RIA Novosti)

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