Ukraine issues Russian gas deal ultimatum

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Ukraine will make one last attempt to resolve its latest energy dispute with Russia before pulling out of negotiations, Ukrainian Prime Minister Mykola Azarov said on Thursday.

"We will make one more attempt to agree with our Russian colleagues. ... We will try one more time to find an agreement," Azarov said in a speech at the National University of Kiev.

"If this fails, then without doubt, the entire responsibility for the consequences will lie with those leaders who refuse to listen to our arguments," said Azarov in a clear reference to Russian officials.

A senior Ukrainian official warned on Wednesday that Kiev would take Moscow to the Stockholm court of arbitration if the two sides failed by mid-October to agree on a lower price that Russia charges for its natural gas.

Ukraine imports most of its energy from its eastern neighbour.

Russian President Dmitry Medvedev, who held unproductive talks over the dispute with his counterpart Viktor Yanukovych last month, responded to the threat of court action by accusing Kiev of wanting "non-stop indulgence".

Ukraine has been trying for months to renegotiate the terms of a controversial 2009 gas deal that it signed with Russia to settle a dispute that saw its supplies cut off in a Kremlin move that also affected other parts of Europe.

The 10-year deal sets higher prices for Ukraine than some EU members states.

Russia has said it was willing to lower the price from the $400 which Ukraine currently pays for 1,000 cubic metres if Kiev joined a new Moscow-led customs union and gave up a 50-percent stake in its state energy company Naftogaz.

Ukraine has flatly rejected the idea.

© 2011 AFP

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