Russia Considering $3 Billion Ukraine Loan for Gas Payments

Russia may loan $2 billion to $3 billion to Ukraine to help the cash-starved nation repay debts to OAO Gazprom.

Prime Minister Dmitry Medvedev asked the Finance Ministry to consider loans to Ukraine on the recommendation of Russia’s natural-gas exporter, according to a statement on the government’s website.

Ukraine’s debt to Gazprom stands at about $2 billion including gas supplies for last month, the Moscow-based company’s spokesman Sergei Kupriyanov said by phone today. Gazprom decided against extending a discount on gas prices after April because of the debt, Chief Executive Officer Alexey Miller told Medvedev at a meeting today, according to the statement.

Supplies to Europe have halted twice since 2006 because of price disputes between Ukraine and Russia. Ukraine’s ability to pay for gas imports came into question after Russia stepped back from a $15 billion bailout package it halted when protests in Kiev toppled President Viktor Yanukovych.

Gazprom shares rose 6.9 percent to 129.39 rubles in Moscow, regaining some of the ground they lost yesterday in the biggest plunge since 2008.

Ukraine seeks answers from Russia about a $2 billion loan it promised last year to pay the gas debt, Ukrainian Prime Minister Arseniy Yatsenyuk said today in Kiev in televised remarks after talks with U.S. Secretary of State John Kerry in Kiev. Ukraine also discussed financial aid with Kerry, Yatsenyuk said, without elaborating.

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