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Moscow and Kiev reach gas debt deal

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Moscow and Kiev reach gas debt deal
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Moscow and Kiev have reached a deal on Ukraine’s gas debt to Russia, warding off a new crisis for now.

Under the agreement, Ukraine has to repay its debt to Russia for all September and some October deliveries by the first of December.

Any future supplies to Ukraine hinge on an accord, says Russia’s gas export monopoly Gazprom: “As we discussed, direct, long-term contracts between Gazprom and Naftogas Ukraine will only be possible if Ukraine fully repays its debt,” said a spokesman on Monday.

Talks will resume in December as the two sides seek to avert a crisis similar to the one which disrupted supplies to Europe in early 2006.

Kiev pays well below market prices for its gas. While it agrees on the need for a gradual transition to European prices, it says Russia is asking too much.