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Russia today began to increase its supply of natural gas to European customers in an attempt to deflect growing international condemnation over its gas war with Ukraine.
Gazprom, Russia's state-owned monopoly, claimed that its former Soviet ally had helped itself to $25 million of gas since its supply was cut off in a politically-charged dispute over a four-fold price increase.
A quarter of Europe's Russian gas imports arrive via a pipeline which runs from Siberia through Ukraine. Kiev denies the accusation that it has been stealing supplies but several central European countries including Austria, Poland and Hungary reported sharp falls in the pressure in their pipelines this morning.
In a telegram sent to Naftogaz, the Ukrainian national gas group, and seen by the Associated Press, Gazprom said that it would increase its output to Europe by 95 million cubic metres a day to compensate for gas which it says is being siphoned off.
President Viktor Yushchenko, chairing an emergency meeting with ambassadors from the European Union, Japan and the United States, denied the accusation and said that the struggle amounted to a fresh fight for independence which would be "tougher" than last year's Orange Revolution.
President Putin, who today assumed chairmanship of the G8 group of the world's richest nations, was accused by the United States of wielding Russia's energy reserves as a political weapon.
The Austrian oil and gas group OMV said that supplies from Russia were down by one third. The Hungarian gas firm MOL said its pressure was down by 40 per cent and Slovakia said it was receiving just 60 per cent of the gas it needs. Poland said on Sunday its supplies had fallen by 14 per cent.
President Yushchenko insisted that Ukraine has enough gas in storage to survive the winter - which has so far been unusually mild - but Ivan Plachkov, his energy minister, has not ruled out siphoning off supplies destined for western Europe if temperatures fall.
"If the temperatures fall below zero, to -3C or -5C, we will extract Russian gas that we receive as payment for transit, in line with existing contractual conditions," he told the Interfax-Ukraine news agency.
Analysts have warned of wider implications if the two powers are unable to reach a compromise. Malcolm Wicks, Britain's Energy Minister, said that there was no immediate threat to supplies but warned that the dispute could undermine trust in Russia’s natural gas industry.
Gianfranco Fini, the Italian Foreign Minister, said that the European Union had a duty to mediate to prevent more widespread consequences across the EU. Italy imports a third of its energy supplies from Russia.
"The union has a duty to take diplomatic initiatives ... regarding the serious consequences for energy due to the deterioration in relations between the two countries, which could affect member countries," S Fini said in a letter to EU leaders.
"The European Union possesses enough political strength to pressure Kiev and Moscow," said the letter addressed to European Commission President Jose Manuel Barroso.
Javier Solana, the EU’s foreign policy chief, today urged Kiev and Moscow to return to the negotiating table. EU energy officials are to meet in Brussels on Wednesday to discuss the crisis.
British Gas said last night that price rises were already inevitable because of increases in wholesale prices since September.
Ukraine says that it is being punished for its attempts to become more independent from Moscow and develop stronger ties with the EU and Nato. Moscow says it is merely charging the market rate.
Ukrainian officials say the 400 per cent price leap would cripple the country’s economy, which relies strongly on energy-intensive heavy industries. Ukraine has not objected to abandoning the cheap price it had been paying, but wants the increase to be phased in gradually.
Other countries which remain in Russia's sphere of influence continue to receive gas at below-market prices.
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