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09KYIV99, GAS CRISIS: WHO’S IN CHARGE?

January 16, 2009

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Reference ID Created Released Classification Origin
09KYIV99 2009-01-16 17:16 2011-08-30 01:44 CONFIDENTIAL Embassy Kyiv

Richard W Frost  01/20/2009 12:56:00 PM  From  DB/Inbox:  Richard W Frost

Cable 
Text:                                                                      
                                                                           
      
C O N F I D E N T I A L        KYIV 00099
BRUSSECX:
    ACTION: UPOL POL
    INFO:   UPAO UPRM ECON AMB ODC DAO PAO POLAD PR UAMB
            RSO UDCM DCM UECON

DISSEMINATION: POL
CHARGE: PROG

VZCZCBSO717
OO RUEHBS
DE RUEHKV #0099 0161716
ZNY CCCCC ZZH
O 161716Z JAN 09
FM AMEMBASSY KYIV
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7055
INFO RUCNCIS/CIS COLLECTIVE
RUEHZG/NATO EU COLLECTIVE

C O N F I D E N T I A L KYIV 000099 
 
E.O. 12958: DECL: 01/16/2019 
TAGS: PREL PGOV ETRD UP RS
SUBJECT: GAS CRISIS: WHO'S IN CHARGE? 
 
Classified By: DCM James Pettit.  Reasons: 1.4 (b/d). 
 
Summary 
------- 
 
1.  (C) Given the lack of clarity regarding executive 
authority (and the personal animus) which characterizes the 
relationship between President Yushchenko and PM Tymoshenko, 
they have, on occasion, exhibited rare comity during the gas 
crisis, including signing off on two joint letters reflecting 
a shared GOU position.  There have been important moments of 
divergence, however.  The most notable involves what 
happened, or may have happened, during negotiations with the 
Russians December 31, which some claim could have resulted in 
a last minute deal.  End Summary. 
 
Yushchenko Pulls Back 
--------------------- 
 
2. (C) Yulia Mostova, the very well plugged in Deputy Editor 
in Chief of the newsweekly Dzerkalo Tizhnya, told the 
Ambassador that Tymoshenko told her that, because of 
Tymoshenko's good working relations with Putin, she had been 
able to get agreement December 31 with terms for purchase of 
gas of $235 per tcm and $1.76 for transit. (Separately, PM 
Advisor Vitaly Haidyuk told the Ambassador that anything 
worse than $235 tcm and $2.10 for transit made no sense for 
Ukraine.)  The deal excluded the intermediary, RosUkrEnergo 
(RUE).  Tymoshenko ordered Naftogaz head Dubyna, in Moscow, 
to prepare the necessary documents.  However, Tymoshenko was 
then unable to reach Dubyna for the next six hours.  During 
that time, Dubyna apparently received word from Yushchenko to 
back away from the deal.  Yushchenko was, Tymoshenko said, 
seeking to prevent the exclusion of RosUkrEnero or wanted to 
deprive Tymoshenko of a political victory.  In a different 
version, Dubyna told Mostova that Putin had backed away when 
he heard December 31 that Tymoshenko was going to fly to 
Moscow to seal the deal.  As a result of these conflicting 
versions Mostova said it was not clear what happened. 
 
RUE Interests 
------------- 
 
3. (SBU) Tymoshenko publicly blamed oligarch and RUE head 
Firtash, Party of Regions leaders linked to Firtash, and 
Yushchenko for scuttling the December 31 negotiations. 
Yushchenko has categorically and publicly denied any such 
involvement.  Firtash and Regions leaders linked to him, 
joined by Deputy Chief of the Presidential Secretariat 
Bezsmertniy, countered that Tymoshenko -- backed by Kuchma's 
former Chief of Staff (and presumed intermediary to the 
Kremlin) Medvedchuk -- instead seeks to insert an 
intermediary linked to her into the gas trade to replace 
RosUkrEnergo. 
 
Uneasy Division of Labor 
------------------------ 
 
4. (C) In a meeting with the Ambassador January 15, 
Bezsmertniy -- a relentless critic of Tymoshenko -- 
acknowledged that coordination between the President and PM 
in approaching Russia on the gas crisis, such as negotiating 
the two joint letters, had indeed been difficult.  Regarding 
who is in charge, Bezsmertniy said that the PM had primary 
action on the gas crisis but that the President intervened as 
necessary because of his mandate to protect national 
security.   Bezsmertniy observed that perhaps Yushchenko had 
"made a mistake" by not assuming the lead on gas 
negotiations.  Ambassador emphasized the importance of a 
unified Ukrainian position.   Bezsmertniy agreed that was a 
worthy goal, but hard to achieve. 
 
5. (C) Mostova observed to the Ambassador that it was unclear 
who had the lead in negotiations.   When it is convenient for 
Yushchenko, he takes responsibility.   When there is a 
serious problem, he says Tymoshenko should handle it, and 
then criticizes her. 
 
Comment 
------- 
 
6. (C) Tymoshenko's version of the December 31 events, as 
relayed by Mostova, is widely repeated among Rada members and 
the political elite.  However, since the crisis escalated 
with Russia's cut-off of gas, coordination between the PM and 
President appears, despite continued mutual recriminations, 
to have improved.  That said, the ambiguity regarding who is 
in charge remains.  Yushchenko asserts veto power on the gas 
negotiations, while Tymoshenko is operationally the lead. 
Embassy will continue to reinforce the importance of a 
unified GOU position to resolution of the crisis. 
TAYLOR

Wikileaks

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