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. Last Updated: 07/27/2016

Tokarev Calls Ukraine's Hike in Russian Fee 'Unjustified'

Ukraine's increase in crude transit fees this year was "unjustified," pipeline monopoly Transneft said Tuesday, in yet another sign of Moscow's mounting pressure on Kiev to give up control of its energy market.

The comments from Transneft chief Nikolai Tokarev come just days after Prime Minister Vladimir Putin proposed merging Gazprom with Ukraine's state energy firm Naftogaz, to the surprise of many observers.

"There are, of course, some problems with transit to Ukraine. Our partners, Ukrtransnafta, last year introduced, as I believe, economically unjustified tariffs, raising them by 30 percent," Tokarev said during a meeting with Putin.

"And at once, the transit and shipping volumes to Ukrainian refineries fell this year by the same 30 percent," Tokarev said.

Late last year, Ukraine and Russia signed an agreement on oil transit for 2010, in a deal that required Moscow to pay 30 percent more in transit fees.

The state-owned Transneft is also struggling to find 70 billion rubles ($2.4 billion) to fund the Purpe-Zapolyarnoye oil pipeline, the construction of which was ordered by Putin last week.

The 600 kilometer pipeline will be linked to the Purpe-Samotlor pipeline, scheduled to be commissioned in 2012, and will speed up oil deliveries to China from massive oil fields in the Arctic, primarily explored and developed by Rosneft and TNK-BP.

The pipeline will shorten the route to the East Siberia-Pacific Ocean trunk, Russia's first oil pipeline link to China.

During the meeting with Putin, Tokarev reiterated that the second stage of the ESPO would be commissioned in 2014 after the first stage was commissioned late last year.