Russia cuts flow of natural gas to Ukraine

By Aussiegirl

Here's the latest. Looks like Moscow is going to continue to play hardball...and give world opinion a big Russian raspberry.

Russia Cuts Flow of Natural Gas to Ukraine - New York Times

MOSCOW, Jan. 1 -- Russia cut the flow of natural gas to Ukraine today as talks over pricing and transit terms unraveled into a bald political conflict that carried consequences for Ukraine's recovering economy and possibly gas supplies to Western Europe.

Effects were starting to be felt in Europe tonight. The Hungarian natural gas wholesaler MOL said that deliveries from the affected pipeline were down more than 25 percent, according to Reuters. The news agency added that in Poland, supplies dwindled 14 percent.

Still, choking the westbound pipes marks a dramatic gamble by Russia, one likely to send political and economic ripples westward in the months ahead.

Russia is positioning itself to become an energy-supplying nation capable of easing dependency on Middle Eastern oil in Western Europe and even in the United States, which criticized the Russian action today.

"The United States regrets the Russian decision to cut off gas from Russia to Ukraine, with potential effects on gas supplies elsewhere in Europe," the State Department said in Washington. "Such an abrupt step creates insecurity in the energy sector in the region and raises serious questions about the use of energy to exert political pressure. "As we have told both Russia and Ukraine, we support a move toward market pricing for energy, but believe that such a change should be introduced over time rather than suddenly and unilaterally."