Gas Feud Sours Public On Ukraine's Leaders

KIEV -- Ukraine's gas dispute with Russia is unlikely to have won any popular support for Kiev's political elite ahead of the first presidential election since the 2004 Orange Revolution.

The feud with Russia has left Ukraine with no gas supplies for 11 days, accelerating the economy's fall into what is expected to be the worst recession in a decade.

President Viktor Yushchenko's advisers have painted Moscow's actions as "blackmail" to extract an unfair price for gas from Ukraine, which Yushchenko wants to steer toward Europe.

But Ukrainians, exasperated by Yushchenko's bickering with Prime Minister Yulia Tymoshenko, have started to feel the chill in the form of heating reductions in the dead of winter.

Yushchenko and Tymoshenko, allies in the 2004 Orange Revolution that incensed Moscow, have been at each other's throats for a year, paralyzing the political system before a presidential election in 12 months.

"The politicians have placed the people so deep in manure that they have lost all confidence in politicians," said Sergei, owner of a catering business. "I don't know where Ukraine is heading. It's like a ship with a drunk captain."

Many analysts saw the constant squabbling between Yushchenko, a dry former central banker, and Tymoshenko, the former gas magnate turned social crusader, as political maneuvering before the presidential poll.

Ukrainians now face unemployment or pay cuts -- in a currency that has lost about 40 percent of its value against the dollar. The economy is expected to shrink by 3 percent to 5 percent this year, and industries have already cut output by 30 percent.

The opposition Party of the Regions, led by Viktor Yanukovich, has demanded that Yushchenko and Tymoshenko resign over the gas row. But such calls are likely to be ignored. Tymoshenko herself called for Yushchenko's resignation less than a month ago.

"There will be a propaganda battle over the interpretation of the dispute and who resolved it and an information war about who was responsible for the social and economic consequences of the dispute," said independent analyst Oleksander Dergachev.

"[Yanukovich's] advisers are thinking about how to use the situation. The Party of the Regions has a difficult balancing act: to criticize the authorities but to preserve the impression of patriots."

Even before the gas dispute with Russia, there were increasing signs of discontent -- thousands of trade unionists marched against job cuts in December and threatened strikes as thousands more were put on unpaid leave.

But there is little appetite now for mass rallies.

"We've already had our 'Maidan,'" said Ludmila, referring to 2004's protests on Independence Square. "We need new leaders whom we could really follow. As for the old ones -- the nation has known them too long."

European Countries' Dependence on Russian Gas

Russia and the European Union signed an agreement on Saturday aimed at restoring Russian gas supplies via Ukraine, whose cutoff has plunged much of Europe into a midwinter energy crisis. Czech Prime Minister Mirek Topolanek, representing the EU presidency, then flew to Kiev hoping to persuade Ukraine to sign the deal. Slovakia said it would reopen a nuclear power plant unit closed at end-2008 under its EU accession agreement.
AUSTRIA -- About 60 percent of demand is met by Russian gas.
Gas flows stopped on Jan. 7.
No rationing of supply to Austrian firms before next Monday.
Oil and gas group OMV was drawing on reserves, domestic production and other imports to guarantee supply.
GERMANY -- Russian gas meets about 42 percent of demand.
German energy groups E.On and Wingas are relying on gas stores and a transit route via Poland. Gas shipments to Europe via Ukraine have been massively reduced since early on Tuesday, and no Russian gas has arrived into Germany via the Czech Waidhaus border point for a third day.
Energy firms warned of gas shortages if the dispute lasted much longer and subfreezing temperatures endured.
TURKEY -- Russia meets about 67 percent of gas demand.
Production at three Turkish power stations stopped on Thursday. Russian gas supplies from a western pipeline passing through Ukraine were cut on Tuesday. The country has raised supplies of Russian gas delivered via a pipeline under the Black Sea. Gazprom's Blue Stream pipeline to Turkey is working at full capacity of 45 million cubic meters.
Iran raised the amount of its daily supply volumes to Turkey to 18 million cubic meters from 12 million, following the partial cutoff of Russian gas, an Iranian diplomatic source said Friday.
GREECE -- Russia meets about 82 percent of gas demand.
All Russian gas supplies via Ukraine to Greece were halted on Tuesday. Turkey's gas exports to Greece were below the contract level with low pressure on the pipeline.
Greece, a latecomer to creating infrastructure to supply gas to households, is better placed to ride out the Russia-Ukraine gas crisis than some of its neighbors as the country continues to rely on oil for heating and power production.
According to the Greek gas company Depa, natural gas accounts for about 20 percent of Greece's energy needs, with about 9 million cubic meters per day needed to cover domestic demand. About 5 million to 6 million cubic meters come from Russia, via Ukraine and then Moldova, Romania and Bulgaria.
ITALY -- About 28 percent of demand for gas is met by Russia.
Russian gas imports via the TAG pipeline were substantially interrupted from 1 a.m. on Wednesday, with supplies reduced by 90 percent. Italy has tapped its gas reserves.
Economic Development Minister Claudio Scajola said Thursday that Italy had enough gas stocks to last two months and see it through the winter.
FRANCE -- About 24 pct of gas demand is met by Russia.
Russian shipments dropped by more than 70 percent on Jan. 6. French Energy group GDF Suez guaranteed supplies.
France does not rely on gas in the same way as Germany or Italy because 80 percent of its electricity is produced by nuclear power stations.
HUNGARY -- About 60 percent of gas demand is met by Russia.
E.On Ruhrgas is to supply Hungary with 2.5 million cubic meters of gas per day via a pipeline from Austria.
Hungary eased restrictions on some large industrial gas consumers from Thursday morning.
Hungary's MOL and Germany's E.ON Ruhrgas were to export 4 million to 4.5 million cubic meters of gas via Hungary to Serbia and 1 million to 1.5 million cubic meters to Bosnia on Saturday. The two were to make a joint shipment of 1 million cubic meters to Croatia via Austria.
CZECH REPUBLIC -- About 80 percent of gas demand is met by Russia.
The main transit pipeline from Russia to the Czech Republic and Western Europe was shut on Jan. 7.
No customers have suffered any shortfall, said the dominant gas firm RWE Transgas, a unit of Germany's RWE.
The firm said it had about 1.9 billion cubic meters of gas in storage, enough to supply Czech firms and households for several weeks unless the weather was extremely cold. There were no plans at present to reduce supply to industrial customers.
Consumption is about 50 million cubic meters on an average winter day. The country now imports around 17 million cubic meters per day from Norway and Russia via Germany, more than standard shipments coming through the link only from Norway.
The Czech Republic will provide about 4 million cubic meters of gas per day to Slovakia, Industry and Trade Minister Martin Riman said Friday. It would come from a Czech storage facility in Slovakia and may start flowing later on Friday.
SLOVAKIA -- Slovakia said it would restart a nuclear power plant unit it shut down at end-2008 because the cutoff of Russian gas supplies threatened to cause power blackouts. It will resume power production at the 440-megawatt unit of the Jaslovske Bohunice plant in less than six days, the country's prime minister said Saturday.
-- Reuters