Ukraine PM: Gas Deal with Gazprom Will Lead to Naftogaz Bankruptcy

Ukrainian Prime Minister Yulia Tymoshenko on Thursday rejected part of a gas supply deal with Russia, a day after the end of a three-day cut in supplies that raised concerns in Europe.

According to Tymoshenko, the deal would preserve corrupt schemes and abuses, lead to the bankruptcy of Naftogaz and contradict national interests.

Yushchenko and Russian President Vladimir Putin struck an agreement in Moscow on February 12 intended to end a dispute over Ukraine's unpaid debts for Russian gas and to reorganise the gas supply relationship.

The terms of the deal were never made public but Tymoshenko made it clear that she did not agree with Russian demands, prompting Russian state gas monopoly Gazprom to cut supplies by 50 percent over Monday and Tuesday.

Gazprom restored the supplies on Wednesday but the substance of the dispute did not appear to have been resolved. In a joint statement on Wednesday, Gazprom and Naftogaz said negotiations would continue.