Gazprom introduces prepayment system for gas supplies to Ukraine

"The decision is made bacuse of chronic non-payment by Naftogaz of Ukraine. The overdue debt for supplied Russian gas stands at $4.5 billion - $1.5 billion for November-December 2013, and $3 billion for April-May 2014," the news release says. The deadline for Naftogaz of Ukraine's transfer of $1.95 billion payment to Gazprom has expired at 10.00 am Moscow time, and no payment was received by the Russian gas company. Postponing deadline for gas debt repayment

Russia has postponed the introduction of the prepayment system three times. June 11 trilateral talks between Russia, Ukraine and the EU on the price of gas ended with no result. Bilateral talks between Gazprom and Ukraine's Naftogaz yielded no result either on June 15. Gazprom CEO Alexei Miller said that Naftogaz must pay $1.454 billion for November-December and demonstrate some progress on repaying the debt for April-May supplies. Miller said that during the trilateral talks, the debt increased by $2 billion with the unpaid supplies amounting to 11.150 billion cubic meters. During the last trilateral talks, Gazprom agreed to recalculate the April-May debt on the basis of a $384.86 price, but Kiev wants the price to be $326 against $268 it demanded earlier before it starts repaying the debt. Miller said that the $385 price corresponds to the International Monetary Fund recommendations given to Ukraine and that EU Energy Commissioner Gunther Oettinger supports the figure, Itar-Tass reports. The European Commission also backs Russia's approach that paying the debt is necessary.