Jan. 11 (Bloomberg) -- The European Union urged Russia to resume shipments of natural gas via Ukraine after international monitors arrived to measure flows and an accord brokered to resolve a transit dispute was signed by all sides.

The monitoring mission has reached most destination points and has already started work, the Brussels-based European Commission said in an e-mailed statement today.

OAO Gazprom, Russia’s gas exporter that supplies a quarter of Europe’s gas, has said it needs a signed copy of an EU-brokered accord establishing monitoring before resuming the transit via Ukraine that it cut on Jan. 7. Observers should also be in place to ensure Ukraine doesn’t “steal” gas, Russian President Dmitry Medvedev said today on state television. Ukraine denies siphoning.

“The Commission considers that all conditions expressed by the two parties have been met and there is no reason to delay the restoration of gas supplies any further,” the European Commission said.

Sergei Kupriyanov, a spokesman for Gazprom, wasn’t immediately available to comment on the statement. The world’s largest gas producer said earlier today it was yet to receive the document signed by the Ukrainian side.

Russian state-run broadcaster Vesti showed Vladimir Chizhov, Russia’s envoy to the EU, holding a copy of the document signed by representatives of the Russian and Ukrainian governments, the EU, Gazprom and NAK Naftogaz Ukrainy, Ukraine’s state energy company. Next to the signature of Ukraine’s first deputy prime minister were the words “declaration attached,” Vesti said, adding that it was unclear what was meant.

Monitoring Teams

One observation team has been let into a Russian measuring station in Sudzha, the European Commission said. Other groups will travel to the Orlovka, Pisarevka, Sokhranovka, Beregovo and Tekovo stations in Ukraine after arriving in Russia’s neighbor.

Czech Prime Minister Mirak Topolanek, whose country holds the EU’s sixth-month rotating presidency, secured an agreement enabling monitors to check flows into Ukraine’s pipelines from Russia this weekend. If all “goes well,” the monitors may be in place today, Topolanek told reporters in Prague.

“Ukraine is going to have to put its cards on the table,” Ronald Smith, chief strategist with Moscow-based Alfa Bank, said today. “It will be apparent who is telling the truth. With the monitors it will be very clear what’s going on. On the pricing side there’s no reason for Ukraine not to pay market-based prices for its gas.”

Gazprom Losses

Russian Prime Minister Vladimir Putin said Gazprom has lost about $800 million since the start of the dispute with Ukraine, the Interfax newswire reported, citing an interview to be broadcast on German television channel ARD on Jan. 14. Russia is ready to buy into Ukraine’s gas transportation network if the Ukrainian state agrees, he said.

Gazprom’s European customers receive 80 percent of supplies through pipelines that cross Ukraine. Gazprom’s overall deliveries to Europe fell by about 60 percent when it halted transit flows via Ukraine because it accused Ukraine of diverting gas intended for other buyers for its own use, a charge denied by the country. Supplies from Russia to Ukraine itself were suspended Jan. 1 pending a new contract.

Once gas starts to flow in Ukraine, it may take about 36 hours for it to reach EU states, where in some the situation is “serious,” Topolanek said. The Czech Republic has called an energy council meeting for all EU members tomorrow in Brussels, Industry Minister Martin Riman said.

E.ON AG expects full deliveries of gas three days after the fuel enters Ukraine, Kai Krischnak, spokesman for the German utility’s Essen-based E.ON Ruhrgas AG gas division said today. E.ON has “no information” on when Gazprom plans to resume shipments, he said. Poland is yet to receive any news on when supplies may flow via Ukraine, Joanna Zakrzewsk, a spokeswoman for Polskie Gornictwo Naftowe i Gazownictwo SA, said today.

Ukraine 2009 Price

Oleh Dubina, the chief executive officer of Naftogaz, said yesterday talks on a price for supplies of gas to Ukraine from Russia this year had failed to produce a result. Gazprom offered a price of $450 per 1,000 cubic meters after it said Ukraine rejected an offer, subsequently withdrawn, of $250.

Gazprom’s prices to European customers under long-term contracts typically lag behind prices for crude and oil products by about six to nine months. Crude has fallen by more than 70 percent since reaching a record in July. Ukraine paid Russia $179.50 per 1,000 cubic meters for gas last year under a separate arrangement.

Ukraine and Georgia, both former Soviet republics, have strained relations with Russia in their efforts to join the EU and the North Atlantic Treaty Organization. The gas dispute has come as Ukrainian Prime Minister Yulia Timoshenko and President Viktor Yushchenko, who have clashed over economic policy, are facing a financial crisis that has forced them to seek a $16.4 billion International Monetary Fund bailout.

Energy Diversification

In 2006, Russia turned off all gas exports to Ukraine for three days, causing volumes to fall in the EU, and also cut shipments by 50 percent last March during a debt spat.

The current spat has forced member counties of the 27-nation EU to consider how to develop alternative sources of energy and nuclear power. The Slovak government yesterday approved the restart of a nuclear reactor, in the face of EU opposition, to meet the country’s energy needs as the halt in Russian gas supplies continued.

Prime Minister Robert Fico told reporters the move would be for a “necessary” period until the gas market stabilizes. The reactor in Jaslovske Bohunice was closed Dec. 31 as part of the conditions imposed on Slovakia when it joined the EU.

To contact the reporters on this story: Stephen Bierman in Moscow at Sbierman1@bloomberg.net;

Last Updated: January 11, 2009 13:15 EST