Ukraine Gets External Loan of $4 Billion for Gas Delivery

A loan of four billion dollars for the insurance needs of Ukraine’s natural gas was discussed by the European Union, International Monetary Fund (IMF) and European Bank for Reconstruction and Development (EBRD), according to an article published yesterday in the daily newspaper” Times.

According to the publication mentioned, the state energy company of Ukraine, Nak Naftogaz Ukrainy, has no money to pay natural gas that must be delivered next month, till the deadline July seven. In these conditions the utility companies are afraid that the Russian Gazprom will close taps pipes which transit Ukraine.

Moreover, the Russian Prime Minister Vladimir Putin threatened that in case Ukraine will not pay until July 7, Russia “reserves right to act according to contract”.

The European Commission will organize, at the end of this week, a meeting that will participate a series of international financial institutions and gas companies, in the hope that will be able to avoid the interruption of the deliveries in July.

Last days, European Commission President: Jos Manuel Barroso, called on the most vulnerable states to put in place emergency plans and prepare for the worst. In the next period Ukraine should buy about 19 billion cubic meters of natural gas, which will be stored to cover the consumption in the winter period, but funds awarded to Kiev under a loan agreement with the IMF have finished, and the government has recognized that cannot pay the gas bill for July.