Threat Of Gas Cutoff, NATO Tensions Cloud Ukrainian Leader's Visit To Moscow

KIEV, Ukraine -- Ukrainian President Viktor Yushchenko travels Tuesday to Moscow, where he is in for a less than friendly reception.

File photo of Putin (L)-Yushchenko meeting in St. Petersburg, June 10, 2007.
He faces the humiliating prospect of a natural gas cutoff if his country doesn't settle a large debt to Gazprom, Russia's state-controlled gas giant.

And his talks with President Vladimir Putin promise to be further clouded by Ukraine's push to join NATO, its accession to the World Trade Organization ahead of Russia and the investigation into Yushchenko's dioxin poisoning, which he complains Moscow is stalling.

In an unexpected announcement, OAO Gazprom said late last week it would cut off a major chunk of Ukraine's gas supplies on the day of Yushchenko's visit if the two sides didn't settle a US$1.5 billion (€975 million) debt.

The two sides negotiated Monday, but the talks were adjourned in the evening with Gazprom agreeing to push back the cutoff time eight hours to 6 p.m. (1500GMT) Tuesday.

Gazprom has denied that there is any political context to the dispute. But some observers say the cutoff threat, coming on the eve of Yushchenko's visit, may be the Kremlin's way of showing Ukraine how dependent it is on its bigger neighbor and suggesting Kiev reconsider its efforts to join NATO and other policies that Moscow opposes.

Moscow has played hardball over gas supplies in the past.

After Yushchenko became president and began his push for Ukraine to join NATO and the European Union, Russia struck back by raising the low prices it had charged Ukraine for gas.

A resulting price dispute led Gazprom to cut off supplies to Ukraine in January 2006. The supply reductions were also felt in European countries that get Russian gas through pipelines that cross Ukraine, and they are watching the current dispute with some nervousness.

In the current gas dispute, Yushchenko faces an additional complication: his increasingly defiant Prime Minister Yulia Tymoshenko, who herself is expected in Moscow later this month.

The two disagree on how to secure a better gas deal with Russia, and observers say the Kremlin will seek to play one against the other.

Political analyst Mykhailo Pohrebinsky said the visit would be extremely difficult for Yushchenko. "He will put a good face on a bad game," Pohrebinsky said.

Most of Ukraine's gas comes from Central Asia via Russian pipelines, but all the trading is done through a middleman, the Swiss-registered RosUkrEnergo, which is jointly owned by Gazprom and two Ukrainian businessmen. The current debt is owed to RosUkrEnergo.

Critics suspect the complex arrangement was designed to help the middlemen skim off profits. Tymoshenko has pledged to get rid of RosUkrEnergo and a second middleman and purchase gas directly from suppliers. Yushchenko has taken a more cautious stance, arguing that revising the agreement could land Ukraine with a higher bill.

Yushchenko's opponents and some observers link him to RosUkrEnergo — an accusation he vehemently denies. "I thank God that my family and I have something more interesting to be involved in than gas," he said on television last week.

And while Gazprom chairman Dmitry Medvedev, who is almost certain to become Russia's next president, has suggested that the two countries could do without the middlemen, Moscow has clearly indicated that it won't cave in to Ukraine's demands easily.

Moscow has another grudge against Kiev — NATO.

Last month, Yushchenko put in a formal request for NATO's Membership Action Plan, a step considered a key precursor to joining the military alliance.

Even at home, Yushchenko's efforts have met staunch resistance. The majority of Ukrainians, especially in the Russian-speaking east, oppose NATO membership. The Moscow-friendly opposition Party of Regions has paralyzed parliament's work for weeks over the issue.

Analysts predict NATO will be one of the toughest topics on the agenda Tuesday and say the Kremlin may threaten Ukraine with painful sanctions if it goes ahead with membership plans.

Fyodor Lukyanov, editor of Russia in Global Affairs magazine, said Moscow could retaliate by obstructing economic and cultural ties or requiring visas from Ukrainians — a severe punishment for the millions who have relatives in Russia or travel there for work.

But Yushchenko also has a trump card. Just last week his country was accepted into the World Trade Organization and is now in position to control Moscow's bid. Yushchenko has hinted that Kiev will bargain hard.

Yushchenko's still unresolved poisoning, which badly scarred his face, further complicates the visit. Yushchenko, who was a leader of the political opposition at the time, fell gravely ill during the 2004 presidential election campaign and was later diagnosed with dioxin poisoning.

Many in Ukraine point the finger at Russia, because Yushchenko was running against a Kremlin-backed candidate and because Russia is one of the few countries that produce the type of dioxin that was found in his body.

Source: AP