RUSSIA-UKRAINE: HIGH-LEVEL BARBS, LOW-LEVEL

C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 000889

SIPDIS

E.O. 12958: DECL: 04/07/2019
TAGS: PREL PGOV ENRG RS UP
SUBJECT: RUSSIA-UKRAINE: HIGH-LEVEL BARBS, LOW-LEVEL
COOPERATION

REF: MOSCOW 755

Classified By: A/Pol M/C Margaret Hawthorne for reasons 1.4(b) and (d)


1. (C) Summary: Russia has continued its high-level
criticism of the EU-Ukraine gas pipeline modernization
agreement, as evidenced in Prime Minister Putin's April 6
Duma address and FM Lavrov's Rossiskaya Gazeta interview from
the same day. However, businesslike discussions of bilateral
issues continue at lower levels. In the April 3 inter-MFA
talks, DFMs Karasin and Kostenko discussed the upcoming April
10 CIS Foreign Minister meeting in Ashgabat, the status of
the Black Sea Fleet (BSF),Azov-Kerch Strait deliberations, a
schedule for further political contacts, including for the
next exchange of information about each country's activities
with NATO, and cultural issues. The Ukrainian EMBASSY noted
the inflammatory GOR statements were addressed to the public,
while talks at the working level remained productive and
non-contentious. End Summary.

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High-level criticism
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2. (SBU) In the wake of the EU-Ukraine pipeline
modernization agreement (reftel),Russian criticism of
Ukraine's policies continues at the highest levels. Alluding
to the March 23 joint EU-Ukraine declaration on the
modernization of Ukraine's gas infrastructure, Prime Minister
Putin in his April 6 address to the Duma stressed that
excluding Russia from decisions affecting Russia's
"legitimate interests," especially in the area of energy,
would be "counterproductive."


3. (SBU) In an interview with Rossiskaya Gazeta published
April 6, Foreign Minister Lavrov used the EU-Ukraine gas
agreement to argue that Ukraine concluded agreements with
Russia only to "retroactively review" them later on. Lavrov
contended that the EU-Ukraine agreement contradicted the
Russia-Ukraine agreements signed earlier in the year on
Russian natural gas deliveries to Ukraine and transit to
Europe through Ukraine. Lavrov also criticized Ukraine's
non-ratification of the "zero option" on handling former
Soviet Union debts, and cited the ongoing Azov-Kerch Strait
border delimitation talks, accusing Ukraine of ignoring
existing agreements on how to resolve the issue. However,
Lavrov also repeated the GOR's long-standing position that
Russia sought friendly and mutually beneficial relations
between the two "fraternal" nations.

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Cooperation at lower levels
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4. (C) Lavrov's call to further develop ties between the
countries was mirrored in the April 3 meeting between DFM
Karasin and Ukrainian First DFM Kostenko in Moscow. In the
latest round of quarterly inter-MFA talks, both sides touched
upon the upcoming April 10 CIS Foreign Minister meeting in
Ashgabat, the status of the Black Sea Fleet (BSF),Azov-Kerch
Strait deliberations, a schedule for further political
contacts, and cultural issues. Counselor Miroslava
Sherbatiuk from the Ukrainian embassy, who took part in the
discussions, told us that the talks were held in a
professional and non-contentious atmosphere with "no hot
discussions" breaking out on sensitive issues, in an effort
to "calm down emotions" and "counter negative moods in the
public."


5. (C) According to Sherbatiuk, Karasin and Kostenko
discussed the "full set" of issues surrounding the BSF
presence in Sevastopol, including regulatory questions and
inventory plans. The next round of BSF talks was set for
June 5-10. The Azov-Kerch issue was only touched upon, with
both sides agreeing to an experts meeting on April 22-23.
Regarding further political contacts, Sherbatiuk informed us
that no date had been set for the postponed Putin-Tymoshenko
talks, which were to have occurred April 8. However, a new
round of talks on NATO would take place at the end of April,
likely to be chaired by DFMs Grushko and Khandogiy.
Sherbatiuk said Medvedev's European Security Architecture
would also be on the agenda for that meeting, in addition to
the usual exchange of information on each country's
activities with NATO. (Note: Sherbatiuk clarified that
Russia did not use that forum to criticize Ukraine's NATO

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membership ambitions. End Note)

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But gas disagreement dominates
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6. (C) Regarding Lavrov's accusations in the April 6
interview, Sherbatiuk told us that Russia had made the
EU-Ukraine gas agreement the most important issue in
Russia-Ukraine relations. In that vein, Karasin had
similarly expressed to Kostenko Russia's well-known rejection
of the agreement. According to Sherbatiuk, Karasin ignored
Kostenko's invitation that Russia join in the modernization
project, demanding that Ukraine take steps to "correct the
situation."

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Comment
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7. (C) While Russia's tone toward Ukraine has been harsh on
the March 23 EU-Ukraine pipeline modernization agreement, the
Ukrainian EMBASSY considered that the inflammatory GOR
statements were addressed to the public, while the work
behind the scenes remained productive and businesslike.
BEYRLE