Medvedev snub to Ukraine sign of gas ties?

Aug. 1, 2011 at 10:06 AM
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KIEV, Ukraine, Aug. 1 (UPI) -- A decision by the Russian president to postpone a visit to Ukraine is indicative of growing acrimony in bilateral energy ties, an analyst said.

Ukrainian opposition leader and former Prime Minister Yulia Tymoshenko is facing charges in Kiev that a natural gas deal she helped broker in 2009 caused her country significant financial losses.

Russian gas company Gazprom in 2009 cut gas supplies to Ukraine over contract issues and debt. Tymoshenko's deal resumed the flow of gas though acrimony continues to haunt bilateral energy ties.

Russian President Dmitry Medvedev called off a weekend trip to Ukraine, which Dmytro Marunich, director of Kiev's Energy Research Institute, said was a sign of the status of energy relations, the Platts news service reports.

Kiev's economy was left in tatters by the global economic recession that began in 2008. International lenders said Ukraine needed to update its Soviet-era gas transit system as part of a financial bailout.

Marunich said Kiev might face another economic crisis if the energy relationship with Moscow isn't improved.

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