Bloomberg reported that Ukraine is asking Russia for guarantees on natural-gas transit volumes and investments in pipelines as it considers sharing management of the export route to Europe and seeks a new supply contract.

Mr Yuriy Boyko Ukrainian Energy and Coal Minister said after holding constructive talks recently with officials from the Russian gas export monopoly, OAO Gazprom that “I’m sure we’ll find a compromise.”

He said the former Soviet republic may boost gas purchases if the price drops. Ukraine which holds parliamentary elections in October must agree on a lower price with Russia within a month or bow to IMF demands for a 30% jump in household gas fees.

Mr Boyko said Ukraine favours forming a group with the European Union and Russia to manage its pipeline system. About 80% of Gazprom Europe-bound gas deliveries cross through Ukraine. The Moscow-based producer supplies 25% of the EU market.

Ukraine plans to cut Russian gas imports about 48% from contracted volumes this year or agree to lower prices as it seeks to revive a USD 15.6 billion bailout from the International Monetary Fund. Prices have climbed higher than USD 400 per 1,000 cubic meters as Gazprom rejects Ukraine bid to revise the contract.

(Sourced from Bloomberg)