Moscow/Brussels/Kiev/Budapest/Prague - Russian natural gas deliveries fell substantially in downstream markets on Saturday, drawing a sharp European Union demand the Kremlin and Ukraine end a row over energy. Russian natural gas volumes pumped via Ukrainian pipelines to Romania, Hungary, Poland, Slovakia and Romania all were down, with Romania registering a 33 per cent cut in deliveries.
Russia on Thursday halted natural gas deliveries to Ukraine because of a delivery contract dispute. Fuel volumes moving onward to Europe fell marginally on Friday.
The Kremlin at the time said it was leaving volumes sent to Europe unchanged. But on Friday evening, Kiev announced it would siphon some of the Europe-bound gas for its own needs, citing the absence of a contract between Ukraine and Russia for shipping gas to the EU.
Gas volumes from Russia to Hungary had fallen 25 per cent, and to 6 per cent into Poland, according to statements from energy officials in the countries.
The energy supply reductions came against as forecasts calls for falling temperatures across eastern and central Europe, with some regions expected to see temperatures fall as low as 20 degrees below zero centigrade.
Slovakia relies on Russia for all of its gas needs, while Hungary gets 65 per cent and Poland 46 per cent of its gas from Russia, according to figures from the International Energy Agency in Paris.
The shortfalls drew a sharp demand from the EU that Russia and Ukraine resolve their row over gas deliveries and stop jeopardizing supplies to the bloc.
The bloc's statement called "for an urgent solution to the commercial dispute on gas supplies from the Russian Federation to Ukraine, and for an immediate resumption of full deliveries of gas to the EU member states."
The statement was released late Friday evening by the Czech government, which holds the bloc's rotating presidency.
The EU initially tried to stay out of the dispute, calling it a "commercial matter between two non-EU companies." But the fall in supplies and impending severe cold weather forced its hand.
"Energy relations between the EU and its neighbours should be based on reliability and predictability. Existing commitments to supply and transit have to be honoured under all circumstances," the statement said in part.
Ahead of the cut-off, both Russian Prime Minister Vladimir Putin and his Ukrainian counterpart, Yulia Tymoshenko, called the head of the European Commission to accuse the other of starting the trouble and promise that supplies to Europe would not be hit.
"The EU regrets the fact that assurances of the reliability of energy supply have not been met and will continue to monitor the situation closely," the EU's statement said.
An almost identical row in 2006 produced unexpected gas shortages across western Europe. However, since then, the EU has invested heavily in gas storage and diversification, leading experts to say that the shock of three years ago is unlikely to be repeated.
Oleh Dubina, chairman of the Ukrainian natural gas monopolist Naftohaz Ukrainy, on Friday made public data showing Ukraine had amassed sufficient gas in underground reservoirs controlled by the company to function for 45 days without further imports from Russia, and for as long as four months if reservoirs contracted by Russia were tapped as well.
Aleksander Medvedev, vice chairman of the Russian natural gas monopolist Gazprom, in a BBC television interview called Ukraine "no longer a reliable partner," and said the Kremlin intended to bypass Ukraine with future energy shipments to Europe.
Kiev officials while conceding that they are siphoning gas from the pipeline, have denied that they are stealing, arguing gas is needed to run pump stations throughout the system.
The two sides broke off negotiations on Wednesday, blaming each other for the break in talks. Both Kiev and the Kremlin declared they are willing to restart discussions, provided their opponent makes the first move.
After meeting a Ukrainian delegation led by Energy Minister Yuri Prodan on Friday, officials in Prague planned to meet "a key" Gazprom representative Saturday, Czech Republic's energy envoy Vaclav Bartuska said, declining to provide a name.
Gazprom Export's head Alexander Medvedev is also scheduled to visit Prague on Saturday.
