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Putin Says Ukraine May Receive Long-Term Cheap Gas From Russia

Russia's President Vladimir Putin said, “As far as gas is concerned, it is a temporary decision but it can be extended by a decision of both partners. I hope we can agree on a long-term arrangement, it is perfectly possible.” Photographer: Kirill Kudryavtsev/AFP via Getty Images
Russia's President Vladimir Putin said, “As far as gas is concerned, it is a temporary decision but it can be extended by a decision of both partners. I hope we can agree on a long-term arrangement, it is perfectly possible.” Photographer: Kirill Kudryavtsev/AFP via Getty Images

Dec. 19 (Bloomberg) -- Russia’s offer of a temporary 33 percent discount on natural gas prices for Ukraine may be extended for the long term, according to Russian President Vladimir Putin.

Russia is providing Ukraine with cheaper gas and a $15 billion loan because of their special ties, “like close relatives,” to alleviate economic distress, Putin said today at his annual news conference in Moscow.

“As far as gas is concerned, it is a temporary decision but it can be extended by a decision of both partners,” Putin said. “I hope we can agree on a long-term arrangement, it is perfectly possible.”

Ukrainians are staging the biggest protests in almost a decade after President Viktor Yanukovych rejected an European Union integration accord last month and instead chose deeper ties with Russia. Putin two days ago unveiled the aid package for Ukraine after talks with Yanukovych in Moscow. The former Soviet republic, a key east-west gas pipeline transit nation, is struggling with its third recession since 2008 and dwindling foreign reserves.

Putin said while Russia isn’t opposed to the EU deal with Ukraine on principle, it would harm the Russian economy.

To contact the reporters on this story: Ilya Arkhipov in Moscow at iarkhipov@bloomberg.net; Henry Meyer in Moscow at hmeyer4@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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