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European gas war looms as Ukraine seeks cash to pay Gazprom for July deliveries

A summer gas war is brewing in Ukraine, threatening another cut-off of Russian gas supplies into Europe and a worsening of the cash squeeze on Gazprom, Russia’s biggest company.
A summer gas war is brewing in Ukraine, threatening another cut-off of Russian gas supplies into Europe and a worsening of the cash squeeze on Gazprom, Russia’s biggest company. Eleventh-hour talks are under way between the European Union, the International Monetary Fund (IMF) and the European Bank for Reconstruction and Development to secure a stop-gap loan of $4 billion (£2.44 billion) to pay for Ukraine’s gas needs. Naftogaz, Ukraine’s utility, has no cash to meet the payment for next month’s gas, which falls due on July 7, and European power companies fear that Gazprom will shut the taps on gas transit pipelines that traverse Ukraine, putting in jeopardy efforts to fill storage tanks for the coming winter. José Manuel Barroso, the President of the European Commission, has told vulnerable EU states to make contingency plans and to prepare for the worst. He said: “We must not sleep-walk into another gas crisis. There is, indeed, the risk of another major crisis in weeks, not months, and we must protect European citizens.”
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