The New American: Natural Gas Deal Underscores Russia–EU Convergence

On October 30, 2014, after months of reportedly "intense negotiations," Ukrainian and Russian officials agreed to a "short-term" gas deal that will carry both the European Union and Ukraine through the winter with Russian-supplied natural gas, as fighting continues in Ukraine's east.

Under the terms of the agreement, Ukraine will pay Russia $3.1 billion as part of its debt to Russia's state-owned gas company Gazprom, and make an additional upfront payment of $1.5 billion for about 3.9 billion cubic meters of Russian natural gas for November and December.

Ukraine will now pay Gazprom $385 per thousand cubic meters, or 38.5¢ per cubic meter, in November and December. Russia agreed to sell Ukraine natural gas at a reduced rate of $365 per thousand cubic meters from January through March 2015, ensuring that both Ukraine and the EU are not left in the cold this winter. In 2013, 39 percent of the EU's natural gas was imported from Russia.
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