Ukraine agrees cheaper short-term gas deal with Russia

Ukraine has signed a new short-term agreement to buy gas from Russia at a lower price, despite the ongoing conflict in the east of the country.

Ukraine will pay $248 per thousand cubic metres over the next three months down from the $329 it had been paying in the first quarter of this year.

Talks will continue to find a permanent solution to the long-running pricing dispute.

Ukraine said it would still be required to pre-pay Russia for its gas supplies.

Kiev accuses Moscow of supporting separatists rebels in eastern Ukraine in a conflict that began in November 2013 and has left the country in a precarious economic situation.

However Ukraine’s energy minister, Volodymyr Demchyshyn said Ukraine’s state gas company, Naftogaz, had been able to reach a short term agreement with Russian gas giant, Gazprom.

Previously Russia has threatened to cut off Ukraine’s energy supplies over unmet bills.

In the past disputes over the supply of Russian gas to Ukraine have led to knock-on supply problems in other parts of Europe which rely on supplies of gas from Gazprom.