Gazprom to cut Europe-bound gas through Ukraine

Russian Prime Minister Vladimir Putin today ordered gas giant Gazprom to start cutting supplies to Ukraine bound for European consumers in response to Kiev's alleged siphoning from pipelines.

At a meeting in Putin's residence outside Moscow, Gazprom chief executive Alexei Miller said the company would do its best to make up for the shortfall by sending more gas to Europe through Belarus, Poland and Turkey.

"Start reducing it from today," Putin told Miller, referring to a plan outlined by the Gazprom supremo to cut volumes of natural gas shipped through Ukraine by amounts equivalent to those Moscow has accused Ukraine of stealing.

Russia cut its gas supply to Ukraine's domestic market on January 1 as part of a bitter payment dispute and has since accused Ukraine of illegally removing gas transiting its country for clients further downstream in Europe.

Putin, who has bristled at Ukrainian President Viktor Yushchenko's efforts to strengthen relations with the United States, warned on New Year's Eve that Kiev would face "severe consequences" if it impeded the flow of Russian gas.

Ukraine denies stealing and has accused Russia of engineering the crisis. The European Union depends on Russia for around a quarter of its total gas supplies, some 80 per cent of which is pumped through Ukraine.

A similar Russia-Ukraine dispute three years ago disrupted supplies across Europe. Bulgaria, Croatia, Czech Republic, Hungary, Poland, Romania and Slovakia have all reported disruptions in supplies from Russia since January 1.

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