THE spectre of winter fuel shortages across Europe was raised yesterday when Russia cut its gas supplies to Ukraine just as Moscow took over the rotating presidency of the G8 from Britain.

Gazprom, the Russian state gas monopoly, accused Ukraine of retaliating by stealing Russian gas destined for the EU, which gets a quarter of its supplies from Russia, mostly through Ukrainian pipelines.

E.ON Ruhrgas, the German gas distributor, said that the crisis could hurt German industry. Poland, Hungary and Slovakia reported a drop in supplies of Russian gas through Ukraine. Ukrainian leaders denied taking European supplies and accused Russia of putting economic pressure on their country, a former Soviet state that re-aligned itself with the West after the Orange Revolution in 2004.

The Russian move dramatically raised the stakes in a dispute that has pushed relations with Ukraine to a new low and cast doubts on the Russian pledge not to use the country’s vast energy reserves as a political tool. It will also fuel Western concerns about Russia leading the G8 for the first time since joining in 1997. President Putin has said that he wants to use the G8 presidency to focus on energy security.

Gazprom, which provides a third of Ukraine’s gas, said that it was cutting those supplies after the Ukrainian Government refused to agree to a 400 per cent price hike by a deadline of 10am yesterday.

Sergei Kupriyanov, the Gazprom spokesman, said: “The Ukrainian authorities were determined to have a conflict from the start.” He later added: “There is information that Ukraine has begun siphoning off Russian gas that is designated for European users.”

Gazprom says that it wants to raise the price it charges Ukraine from $50 (£29) per 1,000 cubic metres to $230 to bring it into line with international levels.

Ukraine says that the price increase should be smaller and phased in over five years, accusing the Kremlin of using Gazprom to punish it for trying to join the EU and Nato.

“We consider this cut-off an obvious form of economic pressure on Ukraine,” Viktor Yushchenko, the Ukrainian President, said but promised to try to resume talks with President Putin last night.

Mr Putin has tried to appear moderate, scolding Russian and Ukrainian officials for creating a “real crisis”, and offering on Saturday to delay the price rise until the second quarter of the new year.

Gazprom said that Naftogaz, the Ukrainian state gas company, had turned down that offer, although Naftogaz insisted that it had accepted it. Naftogaz reassured Ukrainians that there was enough gas in the country’s underground stores to last until mid-April.

Gazprom said that it was cutting Ukraine’s supplies by 120 million cubic metres a day — roughly its total daily imports — while still pumping 360 million cubic metres a day via Ukraine to other countries.

Nevertheless, the European Commission said that it was concerned that EU supplies would be disrupted just as gas demand reaches a peak because of the winter cold. The energy ministers of Germany, Italy, France and Austria wrote to the Russian and Ukrainian governments over the weekend urging them to ensure a steady flow of gas to Europe.

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