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Ukraine rebels promise to release European monitors

Separatist rebels in eastern Ukraine said Thursday they were holding four unarmed European monitors who went missing three days earlier but promised to release them soon.

The latest abduction in a vital rust belt region overrun by pro-Russian militants since early April underscores the trouble newly-elected president Petro Poroshenko will have in keeping his ex-Soviet republic whole.

Fresh fighting was reported Thursday across parts of eastern Ukraine as the violence continued unabated after having already claimed some 200 lives.

But the Western-backed leader — winner of 54.7 percent of Sunday’s presidential vote — must first avert another showdown with Russia that could see Ukraine cut off from gas supplies by the start of next week.

The 48-year-old confectionary tycoon reached out to Vladimir Putin on Wednesday by announcing that he intended to speak to the Russian leader when they both attend D-Day commemorations in Normandy on June 6.

The talks would be the first between the two neighbour’s presidents since a popular uprising chased a Kremlin-backed regime from power in February and installed a new administration intent on breaking Russia’s historic hold on Ukraine.

– ‘Acts of sabotage’ –

The self-proclaimed “people’s mayor” of the rebel stronghold of Slavyansk said the four civilian monitors from the Organisation for Security and Cooperation in Europe (OSCE) were “all fine”.

“No one arrested them. We detained them. Now we will work out who they are, where they were going and why, and we will let them go,” Vyacheslav Ponomaryov told Russia’s Interfax news agency.

He further suggested that the team could have been involved in espionage.

A source at the organisation told AFP that the team — a Dane, an Estonian, a Turk and a Swiss national — included one woman and that negotiations for their release had been ongoing for some time.

The OSCE source added that the group appeared to have been at one stage held by Russian Cossacks who were helping the rebels in the eastern region of Lugansk.

A second group of 11 observers was detained in the neighbouring Donetsk province on Wednesday. The OSCE said it had managed to re-establish contact with them by the end of the night.

Swiss President and OSCE chief Didier Burkhalter slammed the detentions as “acts of sabotage”. But a spokeswoman in Kiev denied reports that the Special Monitoring Mission might wrap up its operations in Ukraine out of security concern.

– Gas deadline –

Cash-strapped Ukraine has until midnight Thursday to pay Russia $2 billion under an EU-brokered agreement or face a halt in gas supplies next week that would also impact parts of Europe.

Russia and Ukraine launched their third gas war in less than a decade after Moscow decided to cancel its previous rebates and nearly double the price it charges Kiev for gas after the Kremlin-backed president’s fall.

Ukraine refused to pay in protest and has since balked at the terms of an interim deal negotiated with the help of a top EU energy official that would have seen Russia receive a down payment on Kiev’s debt by Thursday night.

Russia’s state-owned natural gas giant Gazprom said a failure to pay will scuttle negotiations on a lower gas price and prompt it to proceed with a cutoff that would impact parts of Europe next Tuesday unless a larger payment of more than $5 billion is made by Monday night.

Putin pointed out on Wednesday that Russia had not received any money for gas since November but was still willing to negotiate a lower price — if it was paid on time.

“This cannot continue forever,” Putin told a government meeting. “Everyone understands that perfectly well.”

About 15 percent of all gas consumed in Europe is pumped in from Russia through Ukraine and analysts said it was in both sides’ interest to find a compromise.

“Our view is that Gazprom and (Ukrainian state energy firm) Naftogaz will eventually reach a compromise on the price,” Moscow’s VTB Capital investment bank said in a research note.

“However, it is unclear how long the discussions between the parties will continue and what the possible consequences will be.”

– Western security alliance –

Poroshenko said Thursday he no longer trusted Russia — accused by both Kiev and Western leaders of orchestrating the insurgency — and would seek a new defence alliance with Europe and the United States.

“The majority of our people do not support our accession to NATO,” Poroshenko told Germany’s Bild daily.

“But in general, we need a new defence alliance with the United States and Europe to protect Ukraine militarily.”

The comments are likely to irritate Putin because he has insisted that Ukraine draft a new constitution that specifies Kiev’s neutrality in international affairs.