The annual fight over payment for the gas that Ukraine buys from Russia is once again in full force. Moscow is warning the EU that it may cut supplies flowing to the Ukraine on January 1st and cannot guarantee that Ukraine will not divert gas intended for transit.  As recently as 2005 Ukraine was paying as little as $50 per thousand cubic meters for its gas and is currently paying $180. Moscow is trying to raise this to $250-300. The Ukraine says $100 would be more appropriate even though European prices have increased to $500.

This year the deteriorating economic situation in Russia and Ukraine seems to be exacerbating the dispute.