January 4, 2006	Wednesday	Zilhaj 3, 1426

MOSCOW, Jan 3: Russia restored natural gas supplies to its crucial European customers on Tuesday after they felt the squeeze of an ongoing price war with Kiev, while Ukrainian officials flew to Moscow for talks to resolve the crisis.

As analysts weighed up the impact of a showdown that has exposed Europe’s reliance on Russian gas, France, Germany and other countries said deliveries were returning to normal.

“The work of restoring supplies is almost finished and Gazprom fulfils all its obligations to European consumers,” said Sergei Kupriyanov, spokesman for the Russian state-controlled energy firm.

“Gazprom is compensating for the illegal siphoning-off of gas but will not be able to do this forever,” he added, accusing Kiev of ‘continuing to steal’ gas destined for western Europe.

Russian and Ukrainian officials confirmed that executives from Ukraine’s state-owned Naftogaz energy company would travel to Moscow for talks with Gazprom to resolve the crisis between the neighbours.

The European Commission, the bloc’s executive arm, called on both sides to return to the negotiating table and expressed concern as the dispute threatened to affect gas supplies across Europe.

The dispute has raised world oil prices. New York’s main contract, light sweet crude for delivery in February rose 21 cents to 61.25 dollars per barrel in electronic trading compared with Friday’s close.

In London, the price of Brent North Sea crude for February delivery won 37 cents to 59.35 dollars per barrel compared with Friday’s close.

Europe imports a fifth of its natural gas from Russia through Ukraine, and analysts across Europe have noted Moscow’s potential to wield mammoth energy supplies for political purposes.

Norway, Europe’s second-biggest natural gas provider, said it would not be able to increase production to offset the effects as it was already operating at full capacity.

Some EU countries which had reported a shortfall on Monday, notably Austria, Germany, Hungary and Poland, said gas supplies were back to normal and France said full deliveries would be back on schedule by the end of the day.

Italy, however, reported imports from Russia still down by 19 per cent.

The row erupted when Gazprom, which controls a third of all global natural gas reserves, demanded an immediate rise in Soviet-era gas tariffs to Ukraine.

Supplies were cut on Sunday after Kiev rejected a hike from 50 to 230 dollars per 1,000 cubic metres.

Russian Prime Minister Mikhail Fradkov called on the European Union to put pressure on Ukraine before a meeting of the bloc’s gas coordination group, scheduled for Wednesday.

“We ask that influence be exerted on the Ukrainian side to bring it back to lawfulness and guarantee it completely fulfil international commitments,” he wrote in a letter to Austrian Chancellor Wolfgang Schuessel, whose country now holds the EU presidency.—AFP