Ukraine Presses Charges Over Putin Gas Deal

Ukraine's state prosecutor's office has launched a criminal case against former prime minister Yulia Tymoshenko over a gas deal she reached with Russia and Prime Minister Vladimir Putin.

The action, comes on the eve of a visit to Kiev by Putin.

"A criminal case has been launched against the former prime minister over abuse of power linked to the signing of gas contracts in 2009," First Deputy Prosecutor General Renat Kuzmin told reporters.

That agreement ended a stand-off that had briefly disrupted Russian gas flows to Europe. It tied the price of gas from Russia's Gazprom to spot oil prices.

Following his victory over Tymoshenko, Ukrainian President Viktor Yanukovych and Russian President Dmitry Medvedev agreed to a 30 percent discount on the gas price of $330 per 1,000 cubic meters which stemmed from the Tymoshenko -Putin agreement.

In return for the deal valued at $40 billion over ten years, Ukraine agreed to extend Russia’s lease on a naval base in the Black Sea.

Even with that discount, fuel costs are squeezing the Ukrainian economy and Ukraine is pressing Russia for relief.

Tymoshenko, who has repeatedly denied any wrongdoing, says the charges against her are politically motivated and claims her opponent Yanukovich wants to ban her from taking part in future parliamentary elections.

Ukraine and Russia are in the midst of conducting intergovernmental negotiations over economic and energy issues.

The discussion were to be highlighted by Putin's visit.  All eyes will now be on the Russian Prime Minister to see how he reacts to this development.

"There is an eye-catching link between the launch of the criminal case against Tymoshenko and Putin's visit tomorrow," said Volodymyr Fesenko, an analyst at Ukrainian think tank Penta.

Read an Article from the Kyiv Post HERE