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BRUSSELS (AP) — Ukraine and Russia on Tuesday failed to get a decisive breakthrough in their standoff over gas supplies to Kiev and will resume European Union-sponsored talks next week.
Russian President Vladimir Putin and his Ukraine counterpart Petro Poroshenko had agreed on a broad thrust of a deal on Friday, but the issues on how, when and how much Ukraine should pay continued to divide the sides.
"One obstacle is that Ukraine has not paid its gas bills for 7 months," said EU Energy Commissioner Guenther Oettinger. "If you go along to the butcher and don't pay your bill for half a year, obviously it is a problem."
Russia is looking for the EU to come up with some sort of financial help to solve the standoff and Kiev has asked the EU for an additional loan of 2 billion euro ($2.5 billion). The next negotiating session is set for Oct. 29.
"We have made some important progress," Oettinger said. "We hope they will reach an agreement on a winter package for Ukraine." He added a long-term solution could wait until after the crucial cold months.
Under the cornerstones that have been agreed, Oettinger said that Kiev would settle its debts with a $1.45 billion payment by the end of the month and $1.65 billion more by the end of the year.
When it comes to new gas deliveries, Ukraine would pay $385 per 1,000 cubic meters which Russia should deliver following advance payments by Ukraine, Oettinger said .
The EU Commission said that the Ukraine request for the 2 billion euro loan will be "evaluated in consultation with the IMF and Ukrainian authorities," adding it "remains very committed to supporting Ukraine in line with earlier commitments."
This year already, the EU has agreed on an aid package of 11 billion euros ($14 billion) to boost the economy of Ukraine as it faced with fighting in the east and the breakaway of its southern Crimea region to integrate with Russia.
Russia cut off gas supplies to Ukraine in the summer over unpaid bills, raising the risks that Ukraine would siphon off gas from the pipeline passing through its territory from Russia to Europe. Europe is concerned that if Ukraine would do that, Russia could cut off all flows through Ukraine, leaving parts of Europe without supplies in the dead of winter, as has happened in the past.
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Raf Casert can be followed on Twitter at http://www.twitter.com/rcasert
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