Across Europe, a new 'cold war'

Russia turned off all natural gas supplies to Ukraine on Wednesday, and the effect has rippled across chilly Europe. Moscow said Kiev not only hasn't paid the higher price it demands for gas, plus late fees, but the Ukrainians are stealing gas meant for others. Ukraine vehemently denied the allegations. Summary.

By DAVID JOLLY and ANDREW E. KRAMER, New York Times

Last update: January 7, 2009 - 9:26 PM

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PARIS - All gas supplies to Europe via Ukraine were shut down Wednesday, as the pricing dispute between Russia and Ukraine escalated. The European Union called for an immediate solution to the crisis.

The Balkans were hit particularly hard as a deep freeze descended on much of the region.

Bulgarian school children bundled in wool coats sang songs to keep warm in their bitterly cold classrooms.

Bosnians drove hours to snap up electric heaters. And in Serbia, millions woke up Wednesday to the Eastern Orthodox Christmas, which is celebrated 13 days after Western Christmas, under the threat of winter hardship.

The cutoff showed the first signs of hitting the European economy as the Hungarian unit of the Japanese automaker Suzuki said it was halting production because of restrictions on industrial users of gas. The Hungarian news agency MTI quoted a spokeswoman as saying Suzuki hoped to restart production Monday.

The Ukrainian gas company Naftogaz accused Gazprom, the Russian gas monopoly, of halting all transshipments Wednesday morning. But in Berlin, Aleksandr Medvedev, Gazprom's deputy chief executive, told journalists that it was Naftogaz, the Ukrainian company, that had closed a fourth pipeline, ending all transshipments to Europe.

Jose Manuel Barroso, the president of the European Commission, called Prime Minister Vladimir Putin of Russia and the Ukrainian prime minister, Yulia Timoshenko, to urge that they quickly restore the flow of gas, a spokeswoman for the commission said in Brussels.

The spokeswoman said Barroso told the leaders that it was unacceptable that Europe be held hostage in their dispute.

The shutdown left Slovakia, the Czech Republic, Austria, Hungary and Romania with no Russian gas supplies amid a bitter cold snap across much of the continent. E.U. countries have access to some other sources of gas, including Russian gas from other pipelines, and gas produced in Britain, Norway and the Netherlands.

Mirek Topolanek, prime minister of the Czech Republic, which currently holds the rotating E.U. presidency, said Wednesday that if gas supplies to Europe were not restored within 24 hours, diplomatic protests would be escalated to the highest political level.

The cutoff began Tuesday, causing shortages from France to Turkey. Gazprom said Ukraine was siphoning off for itself supplies destined for Europe, and that Russia would reduce shipments by an equivalent amount. Russia had already halted all supplies to Ukraine for domestic use, saying its western neighbor was not paying enough for the fuel.

Gazprom is seeking to raise the price Ukraine pays for gas to $450 per 1,000 cubic meters from $179.50 last year.

It also wants to collect what it says are fines for late payments on previous shipments.

Ukrainian President Viktor Yuschenko called for immediate talks in Moscow.

The Associated Press contributed to this report.