Wednesday, January 7, 2009

Russian gas flow halted through Ukraine to Europe

By Dmitry Zhdannikov and Pavel Polityuk - MOSCOW/KIEV (Reuters) - Russia shut down all gas flows to Europe through Ukraine on Wednesday and told Kiev it would restore supplies only after it had signed a new contract at prices comparable to those paid by European countries.

The row over gas prices and debts owed by Ukraine to Russia cut heating to tens of thousands of households in Bulgaria and hit supplies as far west as France and Germany as Europe faced freezing mid-winter temperatures.

"The price should be a market price based on a pricing formula," the Kremlin quoted Russian President Dmitry Medvedev as saying in a telephone conversation with Ukrainian President Viktor Yushchenko.

"There will be no discounts or preferences for Ukraine."

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