German Chancellor Merkel voices 'cautious optimism' for Russia-Ukraine gas deal

Berlin: German Chancellor Angela Merkel voiced "cautious optimism" on Thursday that the EU will broker an end to the Russian-Ukrainian gas standoff despite the "fragile" situation in the conflict-torn country.

She pointed to ongoing violations of a ceasefire agreed early last month in Minsk between the Western-leaning government in Kiev and pro-Moscow separatists in eastern Ukraine.

"I do not believe that the serious problems between Russia and Ukraine, and thus also between us and Russia, will suddenly be resolved," she said.

But Merkel said she hoped that Germany's outgoing European Energy Commissioner Guenther Oettinger "will still manage to find a solution that gives security to us and Ukraine, in particular for the coming months".

The gas supply issue "is being worked on intensely, and therefore I'm cautiously optimistic," Merkel said during a visit by Poland's new Prime Minister Ewa Kopacz.

Russia nearly doubled Ukraine's gas price a few weeks after the February ouster in Kiev of a Kremlin-backed president who had earlier rejected a historic EU trade and political association pact.

The Russian state gas giant Gazprom cut deliveries to its western neighbour in mid-June after Kiev refused to pay the higher rate, and all European mediation efforts since have failed.

A new round of EU-mediated talks between Moscow and Kiev is still under discussion.

Ukraine has tried to make up some of this year's shortage by boosting purchases from its western neighbours. But Russia has warned it may be forced to interrupt European supplies because of some nations' decision to re-export gas to Ukraine in breach of their Gazprom contracts.

More generally, Merkel said, Berlin would make its contribution to resolving the conflict between Moscow and its Soviet-era satellite by working with the Organisation for Security and Cooperation in Europe and monitoring upcoming parliamentary elections.

"But the prerequisite for everything is of course that this ceasefire really holds," she said.

"And considering the UN has said that since the ceasefire came into force 300 people have lost their lives, you see how fragile the situation still is," she told a joint press conference.