“Deadlock”: Donbass Blockade Risks Plunging the Ukraine into Energy Collapse

_____________________________________

On Friday, Ukrainian President P A Poroshenko enacted a decree earlier adopted by the National Security and Defence Council on diversification of coal supply sources and creating reserves of power generating coal. In addition, the Council also decided to tighten control over the products’ movement in the Donbass region. It mandated that the government develop measures to neutralise threats to Ukrainian energy security and imposing a ban on anthracite exports from Ukraine. It also puts the government in charge of rebuilding transportation infrastructure damaged during the military operation in the Donbass.

In late December 2016, a so-called Ukrainian “volunteer fighters group” declared a trade and economic blockade of the Donetsk People’s Republic (DNR) and Lugansk People’s Republic (LNR). According to the group, any trade operations with the LNR or DNR are illegal. The blockade resulted in disruptions in anthracite shipments from the Donbass Peoples Republics and forced the Ukraine to introduce a state of emergency in the energy sector. On Monday, Energy Minister I S Nasalik said that the country’s reserves of coal for energy-generating power plants might dry up in 45 days if they don’t lift the blockade. Russian journalist and industrial expert Leonid Khazanov emphasised:

The measures Kiev is taking are insufficient to resolve the energy conundrum. The Ukraine is risking plunging into an energy catastrophe, with everything that implies for its people and the Ukrainian industrial sector. However, if [the government] wanted to fight radicals they would’ve taken real measures, not just a decree. It seems that President Poroshenko has no control over the situation on the railways or he fears an escalation. Kiev could compensate for the coal shortage with supplies from Russia and other countries. However, the Ukraine lacks financial resources and the West is unlikely to come to its help in this situation. The question now is where to buy coal. One option is to buy supplies from Russia. Other variants include other foreign markets, but they’re more expensive than shipments from the Donbass or Russia. If the Ukraine decides to find other foreign suppliers, not all of them would agree to work with Kiev due to its financial difficulties. The Ukraine doesn’t have the money to afford such shipments. They could ask for help from the IMF or the USA. However, I don’t think they would give them the money. Western politicians are pragmatic. What can Poroshenko give them in exchange? His loyalty [to the West] isn’t enough. The situation in the Ukrainian energy sector is in deadlock. Maybe Kiev should initiate dialogue with the Donbass or ask help from Russia, but Kiev-Moscow ties are very tense now. As I see it, the Ukraine is nearly at a standstill.

19 February 2017

Sputnik International

https://sputniknews.com/europe/201702191050837470-ukraine-donbass-energy-crisis/

Advertisement