EU, Ukraine to discuss bridging loan to Kyiv for gas purchase - Merkel

The European Union and Ukraine will discuss a bridging loan to Kyiv next week so that the country can pay in advance for Russian gas deliveries for the coming months, German Chancellor Angela Merkel told reporters on Friday after the first day of a European Union summit.

She said that Ukraine needs a certain amount of this intermediate funding, because the next tranche of the International Monetary Fund (IMF) could be transferred to the country only next year, but she did not specify any details.

As reported, during the latest round of trilateral gas talks between Ukraine, Russia and the EU in Brussels on October 21 the sides failed to resolve the issues of the deficit of Naftogaz Ukrainy's funds needed to pay in advance for up to four billion cubic meters of gas in November and December this year, as well as the issue of legal registration of agreements. The EU hopes that both problems will be resolved by the next round of talks to be held in Brussels on October 29.

Given the agreed gas price of $385 per 1,000 cubic meters, Naftogaz will need up to $770 million a month to make a prepayment for up to two billion cubic meters of gas each in November and December.

Earlier, the EU stated that this week Kyiv would ask the EU for EUR 2 billion ($2.53 billion) in additional funding.