Russian Oil Subsidies

It appears that the Russian demand for Ukraine to pay the market price of gas has destabilised the relatively new government - as was probably intended.

From the article;

OPPOSITION MPs in Ukraine have issued a stinging rebuke to President Viktor Yushchenko by voting to sack his cabinet over last week's deal to end the "gas war" with Russia.

A motion of no confidence on Tuesday was backed by 250 votes to 50 to dismiss the Prime Minister, Yury Yekhanurov, and his cabinet and reappoint them as acting ministers until elections in March.

Many MPs had reacted furiously to the deal with Moscow, under which control of Ukraine's gas imports was handed to a shadowy trading company called RosUkrEnergo, which has refused to reveal who owns half of its shares.

Russia was in a win-win situation either way. It should also be remembered that Indonesia recently removed their oil-subsidies which led to a 90% increase in the price of oil. It survived the bump as all good stable societies and democracies do. Yushchenko has probably sold the will, resilience and democratic demands of the Ukrainian people short. It will be interesting to see if he pays for it in March.
Permalink, Russian Oil Subsidies, Jan 2006, cam
adam: Ukraine vs Indonesia: I wonder how relatively crucial oil is to the average Indonesian vs gas to the average Ukrainian coming into winter.  I\'m thinking \"can\'t afford to ride my scooter to work\" versus \"can\'t afford to stay warm enough to live\".
cam: Indonesia also doesnt have gas pipes: running across its\' territory that supplies western Europe. So you have to wonder if there was any strong arming going on as well from the western European nations.

cam

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