Russia gives Ukraine cheap gas, $15 billion in loans

Russia gave Ukraine a steep discount on gas, and promised to buy $15 billion worth of the nation’s bonds in a deal struck during President Viktor Yanukovych’s trip to Moscow on Dec. 17.
The deal is expected to give a short-term boost to the nation’s crippled finances, but it’s unclear what concessions Ukraine had to make in exchange.

Russian President Vladimir Putin said that the new price for Ukraine will be around $268.5 per 1,000 cubic meters of natural gas, about $150 cheaper than the current price. This could save Ukraine $3.5 billion per year at current consumption rates of 26-27 billion cubic meters per year.

Other amendments to the contract include extended terms of payment and the currency in which settlements are made, according to Interfax-Ukraine. There are no other details available about the documents.

Putin, however, said that the new deal is a temporary solution.

“The long-term agreements must and will be achieved. This concerns both the supplies of gas to Ukraine, and uninterrupted transit of Russian gas to the European consumers”

he said, according to Interfax news agency.
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Kyiv Post

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