"If we switch to free market relations in the sphere of gas supplies, the price for Ukraine could be more than $400 as of January 1, 2009," Alexei Miller told Russian President Dmitry Medvedev.
Medvedev ordered on Thursday Gazprom to recover $2.4 billion in debts from Ukraine for natural gas supplies.
"We need to finally decide on the Ukrainian debt and recover it either in a voluntary or compulsory manner in accordance with the established legislation and within the framework of our bilateral agreements," Medvedev said at a meeting with Miller.
Medvedev stressed the importance of receiving full payment for gas supplies given the financial pressure on Russia due to the credit crunch and falling oil prices.
The payment owed by Ukraine "is a large sum of money for any state and for any company, including Gazprom," he said.
The president also noted that Ukrainian Prime Minister Yulia Tymoshenko pledged during her visit to Moscow in early October that the debt would "be repaid in accordance with the established procedures." However, the Gazprom chief told the president that since Tymoshenko's visit to Moscow, Ukraine's debt had "increased rather than decreased."
In mid-February, Russia and Ukraine agreed to remove intermediaries from their gas dealings, which Kiev had blamed for the accumulation of its gas debt.
Ukraine currently pays $179.5 per 1,000 cubic meters for gas imported from Russia or via Russian territory. Until recently, gas was sold via the Swiss trader RosUkrEnergo, in which Gazprom holds 50%.
RosUkrEnergo was established in July 2004 on a parity basis between Gazprom and Ukraine's national oil and gas company Naftogaz as the exclusive supplier of natural gas to Ukraine.
Naftogaz said on Thursday that its debt to intermediary RosUkrEnergo stood at around $1.3 billion.
"Today, the debt, taking into account all factors, is one billion and 260 or 270 thousand U.S. dollars," Naftogaz Deputy Board Chairman Volodymyr Trikolych said, adding that the Ukrainian company had no debt to Gazprom.
