MOSCOW, April 11 (RIA Novosti) – US and EU energy companies would not tolerate the delays in payment by Ukraine that Russia has faced, an economist at the London Vanguard investment firm told the Voice of Russia radio station Friday.
“Historically, since the end of the USSR, Ukraine has repeatedly failed to pay for its Russian gas. This is an old story and no US or EU energy company would be as patient and cooperative with Ukraine as has Gazprom,” Vanguard economist William Wilson said.
Russian President Vladimir Putin on Thursday sent a letter to 18 European leaders voicing concerns over Ukraine’s debt crisis. Putin said that over the past four years Russia has been subsidizing Ukraine’s economy with discounts on natural gas worth $35.4 billion.
Wilson said that Ukraine could hardly sustain its economy without Russia’s deliveries. He specified that European and American promises to replace Russian gas with their supplies are not based in reality, as Ukraine is not their top-priority concern.
“The US and EU are publicly suggesting that US liquid natural gas (LNG) exports and yet-to-be-built EU import terminals will replace Gazprom pipeline gas. The statements are not realistic since the earliest US LNG exports are still two years away and Baltic, Polish and Finnish LNG import terminals are two to three years away,” Wilson said.
The economist added that the US would likely focus on LNG exports to Asian markets, where prices are higher.
Russia has been supporting its western neighbor's economy through natural gas deliveries since Ukraine emerged as an independent state in 1991. Under a number of agreements between the two countries, Ukraine received unprecedented privileges and discounts on the price of Russian natural gas. Over the past five years, Russia has supplied Ukraine with 150 billion cubic meters of gas.
Ukraine has systematically delayed payments for the resource. According to recent estimates, Ukraine owes Russia some $17 billion in gas discounts and another $18.4 billion incurred as a minimal take-or-pay fine.
In his letter, Putin said that Russia can no longer carry Ukraine’s economy on its shoulders and called for urgent ministerial consultations to find ways to stabilize the country’s shattered economy.
The letter was sent ahead of a multilateral meeting on the crisis in Ukraine attended by senior officials from the United States, Russia, Ukraine, and the European Union.
