The talks, regarding payment of debt by the Ukrainian energy company Naftogaz to Russian energy company Gazprom, comes after Ukrainian President Petro Poroshenko was inaugurated in Kiev Saturday, promising no negotiation with armed insurgents occupying pockets of eastern Ukraine.
Ukraine risks losing deliveries of Russian gas unless debts to Gazprom are paid by June 10. At issue is a near-double increase in prices, to $485 per 1,000 cubic meters of gas, effective Apr. 1, demanded by Gazprom after Ukrainian President Viktor Yanukovych was overthrown. Payments of arrears made by Ukraine prompted Gazprom to eliminate a demand that future gas shipments must be paid for in advance.
Russian Energy Minister Alexander Novak and Ukrainian Energy Minister Yuri Prodan are participating in the talks, with European Union Energy Commissioner Guenther Oetttinger as mediator.
Russian President Vladimir Putin said last week Naftogaz and Gazprom were "close to reaching final agreements" on a price structure.
Poroshenko did not mention natural gas in his inaugural address, but made it clear Ukraine would enter political and economic agreements with the European Union and away from future ties to Russia. The previous Ukrainian government took the opposite approach, prompting demonstrations that ended the Yanukovych administration.
"The pen is my hands," Poroshenko said. "European democracy, for me, is the best form of government invented by mankind."
He added that "Russian mercenaries" would be afforded safe passage home from eastern Ukraine but promised no negotiation with pro-Russia separatists, and again pointed out Ukraine would not accept Russia's annexation of Crimea.