Russia tightens squeeze on Ukraine with gas price rise

|By:, SA News Editor

Gazprom (OGZPY) raises gas prices for Ukraine by 44% after a discount deal expired, stepping up financial pressure on the country's government in its crisis in relations with Russia.

Gazprom says the increase complies with its supply contract and is necessary because Ukraine owes more than $1.7B for gas bought since early 2013.

The move raises fears that state-run Gazprom may threaten to cut supplies to Ukraine, which buys about half its gas from Russia, something that’s happened at least twice since 2006 because of payment disputes.