Roman Olearchyk

Roman Olearchyk has been the Financial Times correspondent in Ukraine since 2006.

Leaders from Kiev and Brussels were busy this weekend warming up their energy ties as Vladimir Putin bailed out early from the G20 summit in sunny Australia where he faced one could shoulder after another from international leaders over his actions in Ukraine.

Ukrainian president Petro Poroshenko spent Saturday and Sunday receiving a warm welcome from Visegard state leaders meeting in Slovakia (he is pictured above with his Czech, Polish, Slovakian and Hungarian couterparts). He also received guarantees from Bratislava that his country – still at odds with Moscow over fair natural gas prices – would be guaranteed what officials said could amount to 21bn cubic metres of annual reverse flow inflows, enough to meet a majority of the country’s import needs. Read more

Cold bathroom showers are compounding the misery felt by millions of Ukrainians oppressed by the combined effects of Gazprom’s stoppage of natural gas supplies, an economy in free fall and protracted battles between the national army and Russian-backed separatists in breakaway eastern regions.

Vitali Klitschko, the heavyweight boxing champion turned mayor of Kiev, announced on Monday that all hot water provided by municipal boilers to Soviet-built apartment buildings would be shut off through “September, the end of September.”

Though hot water in older apartment buildings is typically shut off for a week or two during summer periods for pipe cleaning purposes, the drastic measure taken by authorities now is necessary – officials say – to ensure that a country without Russian imports can maintain enough natural gas in underground storage facilities to heat homes during the winter. Read more

Ukraine’s prime minister ordered his government on Friday to prepare for a possible cut-off in natural gas supplies from Russia from Monday – and to initiate a Stockholm arbitration tribunal – citing failed negotiations with Kremlin-controlled Gazprom.

“The energy security of Ukraine and the European Union is being disrupted in connection with the intentional one-sided refusal of the Russian Federation to regulate this conflict,” Arseniy Yatseniuk said in a statement. Read more

With pressure from the east piling up, Kiev’s pro-western government is shifting gears to more swiftly integrate its vast but financially-troubled energy sector with the west.

Arseniy Yatseniuk, Ukraine’s prime minister, said on Wednesday his government had decided to unbundle Naftogaz, the debt-laden state gas and oil company, into separate domestic supply, transit and storage companies. Read more

After paying a record bail of $174m, Russia-linked Ukrainian oligarch Dmitry Firtash – arrested last week at the request of US law enforcement – was released from an Austrian prison on Friday on condition that he does not leave the country.

“The last week has been a testing time for my family and me. I would like to thank personally all of my friends and colleagues who have supported me through this difficult period,” he was quoted as saying in a statement upon release.

But Firtash is not off the hook yet. Read more

Even with the threat of Russian invasion and economic punishment hanging over them, Ukraine’s authorities are busy hunting down what they consider to be the cronies of toppled president Viktor Yanukovich.

The most recent of a dozen or so individuals to be put on the wanted list – some of them former government officials – is Serhiy Kurchenko. Read more

Rinat Akhmetov, Ukraine’s richest oligarch, claimed to the Financial Times on Monday that he pleaded with Viktor Yanukovich to resign when he last saw him on February 22, two days after nearly 100 anti-government protestors in Kiev were killed amid sniper fire and clashes with riot police. Read more

In a news briefing aired Tuesday on Russia Today, Vladimir Putin, Russia’s president, retaliated against Ukrainian billionaire Igor Kolomoisky who on Monday described him as a “schizophrenic of short stature” for bringing Russia and Ukraine to the verge of war.

Putin said: “What we see in the east [of Ukraine] now is that billionaires are being installed as governors. We understand that these people gained their fortunes through loans and shares. One of these oligarchs cheated Roman Abramovich. Abramovich lent him several billion dollars, and he just pocketed the money. He is now governor of Dnepopetrovsk.” Read more

Ukrainian billionaire Igor Kolomoisky, who this weekend agreed to become governor of his native Dnipropetrovsk region as the country braces for a broader Russian invasion into eastern Ukraine, described Russia’s president Vladimir Putin as a “schizophrenic of short stature” for putting Russia and Ukraine on the verge of war.

“I don’t understand how Ukrainians and Russians can fight,” he said in an online videoRead more

Ukraine’s parliament appointed in a near unanimous vote on Thursday afternoon Arseniy Yatseniuk, one of the country’s youngest but most experienced politicians, as prime minister to address a swiftly unfolding separatist threat in the autonomous republic of Crimea and a crumbling economy.

Addressing lawmakers nearly a week after Viktor Yanukovich was toppled from the presidency, the 39-year old political ally of recently released opposition leader Yulia Tymoshenko said: “Today our country finds itself in one of its most difficult and historical moments.” Read more

As the death toll from Tuesday’s deadly clashes between Ukrainian anti-government protestors and riot police rose to more than ten, and Kiev’s main square was lit by flames, the country’s powerful oligarchs called for an end to the bloodshed.

It was a case of too little, too late from the businessmen who many had hoped would use their influence to persuade Viktor Yanukovich, president, to avert bloodshed and seek compromise with the protesters. Read more

Source: National Bank of Ukraine

Foreign currency reserves of crisis-hit Ukraine plunged $2.6bn in January, the country’s central bank revealed on Friday hours after introducing fresh capital controls that bankers warned could choke trade and boost black market business activity. Read more

A falling currency, continuing protests – and a rival bailout?

There is no deal yet in place. But the US, EU and international financial institutions are, according to sources, holding “behind the scenes” talks to package financial assistance that would ensure “economic stability” in crisis-hit Ukraine (and here’s the rub) should a pro-western and reform-minded caretaker government be put in place.

There’s an “if” for you. Read more

Ukraine’s cash-strapped government may have secured short-term relief for its ailing economy by landing a 30 per cent discount on Russian natural gas imports prices late last month through a broader $20bn bailout agreement.

But recognising that Russia’s leadership could hike prices up again in the future, the administration of President Viktor Yanukovich does not appear to be dropping long-term plans to diversify gas supplies, crucial in breaking the energy inefficient economy’s longstanding heavy dependence on Russian fuel. Read more

A Russian bailout that Ukrainian president Viktor Yanukovich brokered last month appears to have propped up Kiev’s central bank reserves that were dwindling last year amid weak demand for Ukraine’s exports and a recession that was triggered, in part, by lack of reforms.

But the bailout has not stabilised the situation on Kiev’s streets. Read more