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. Last Updated: 07/27/2016

West Fears Disruption of Gas Pipeline

Russian natural gas supplies to West-ern Europe may be at risk if the conflict between Russia and Ukraine over deliv-eries and payments gets out of hand, Western importers said Thursday.

They said they fear that Ukraine may tap the gas pipeline from Russia to Western Europe to supplement its own supplies, after Russia on Wednes-day raised the amount it charges Ukraine for gas and threatened to reduce oil deliveries.

Russia raised the price to $85 per 1, 000 cubic meters, up from $27 on Tuesday, after which Ukraine threat-ened to charge higher fees for trans-porting Russian gas to Western Europe.

Fernando Orichuie, chief represen-tative of the Italian gas importer ENI, said he was worried that the conflict could lead to a drop in gas supplies to Western Europe, as happened last October when a similar conflict over the price of gas erupted. Ukraine siphoned off gas supplies destined for Western Europe, causing a drop in supplies to as low as 50 percent of nor-mal levels.

Gerhard de Combe, of the Austrian gas importer OMV, said the dispute between Russia and Ukraine might affect the quantity but not the price of Austria's gas imports, because its con-tract with Russia is pegged to the world price of gas, not domestic factors.

The conflict may also affect gas sup-plies to France and Germany, which each depend on Russia for about one-third of their gas supply.

Russia and Ukraine have been at odds over foreign debts, gas trade and the Black Sea Fleet for months. On Wednesday, Russian Deputy Prime Minister Alexander Shokhin linked all of these conflicts in defending Russia's price increase.