Brussels calls on Kyiv, Moscow to immediately resolve gas dispute amid fears of transit disruption

The European Commission finds the latest developments on the issue of Russian gas supplies to Ukraine a matter of concern and calls on Ukraine and Russia to find a solution to the problem.

According to an UNIAN correspondent in Brussels, a corresponding statement by EC Vice-President Maros Sefcovic was released Friday.

"It is the Commission's view that this situation raises concerns not only for the direct supply of natural gas to Ukraine but possibly also for the transit of gas to the EU. The Commission therefore calls on all parties concerned, companies and respective Ministries of Ukraine and Russia, to find immediate solutions in line with the decisions of the Stockholm Arbitration Tribunal. The Commission stands ready to steer a trilateral process which in the past has already proven to be effective in situations of disagreement," the statement says.

To this end, Vice President Sefcovic has called the Ukrainian and Russian energy ministers in order to assess the situation and to agree on the necessary next steps.

Read alsoRussia's Gazprom announces termination of all contracts with Ukraine"It is important that both, Russia and Ukraine reaffirm their respective positions of a reliable supplier and transit country of gas, as was the case over the past years," Sefcovic said.

He confirmed that the Ukrainian authorities had informed the EC about their concern regarding a possible emergency situation in the Ukrainian Gas Transmission System. This issue is, according to the information so far available to the Commission, based on from three elements:

- Continuous low and varying pressure in gas supply from Russia to Ukraine for transit to the EU: this phenomenon is not new but was already investigated by the Commission and the European Network of Transmission System Operators for Gas (ENTSOG) with Naftogaz and Gazprom last year. However under current circumstances (low temperatures, high domestic gas demand, expected direct imports from Russia) the low pressure in the Gas Transmission System becomes particularly problematic;

- Lack of direct supply from Gazprom to Naftogaz: it seems that Naftogaz and Gazprom have not managed to agree on the import terms of natural gas despite the decision of the Stockholm Arbitration Tribunal, which led to the refusal of the delivery of natural gas even for volumes pre-paid by Naftogaz;and

- Increasing reverse flows from the EU at a short notice is challenging at the moment because of tight spot markets (low temperatures throughout EU) and difficulties to technically rearrange the flows within the Gas Transmission System.

Read alsoUkraine's energy crisis response plan in action: Switching from natural gas to boiler oilThe Commission is currently further clarifying the facts with the European Network of Transmission System Operators for Gas, according to the report.

As UNIAN reported earlier, on February 28, Naftogaz received the final decision of the Stockholm Arbitration ordering that Gazprom pay Naftogaz $4.63 billion. Following the consideration of the two cases (another one – on gas purchase), Gazprom owes the Ukrainian company $2.56 billion, while the Ukrainian company owes nothing.

The Russian company did not agree with the Arbitration award and said they would appeal it. On March 1, Gazprom refused to supply gas to Ukraine in March 2018, having returned to Naftogaz a corresponding prepayment. The Ukrainian Cabinet claimed that the lack of Russian gas in the overall energy balance would not significantly affect the national economy. At the same time, with the aim of optimizing the performance of the GTS, the government introduced a gas-saving action plan for the period of several days.

On March 2, Gazprom announced its intention to initiate in the Stockholm Arbitration termination of all existing contracts with Naftogaz.