FACTBOX: Russia's relations with gas transit states

LONDON (Reuters) - Russia holds the world's largest gas reserves and is the biggest gas exporter but tense relations with the states across which it pumps the fuel to western Europe have alarmed many customers over the last few winters.

The prices paid by some of Russia's neighboring ex-Soviet states --Ukraine, Belarus and Moldova -- are much lower than those paid by western Europe. Moscow's attempts to make them pay more have met with strong resistance.

Russia expects its eastern European neighbors to be paying western European prices by 2011, coinciding with Russia's liberalization of domestic gas prices.

But economic crisis, particularly in Ukraine which has seen its currency slump against the dollar over the last few months, has made it more difficult for transit states to settle their debts or pay more for future supplies. This has strengthened their determination to fight the increases.

The following is a summary of disputes and price negotiations and brief profiles of transit states.

UKRAINE

Russia supplies Europe with a quarter of its gas needs and 80 percent of this passes through pipelines across Ukraine.

Russian gas export monopoly Gazprom said last week it would cut off supplies to Ukraine from January, when heating demand is highest, as Kiev was unable to meet its debts by the end of the year.

Gazprom said Ukraine had paid just $800 million of arrears of its debt for supplies out of a total of $2.4 billion and analysts say Ukraine's dire economic problems will make it very difficult to pay the rest back.

Ukraine has been charged $179.50 per 1,000 cubic meters (tcm) for its heating fuel this year, less than half the price paid by consumers in western Europe, but Gazprom has threatened to push up the price to $400 if arrears remain unpaid.

Ukraine has long haggled over how much it pays Russia for gas and the row came to world attention in January 2006, when it led to supplies to western European customers being halted.

In March 2008 Russia halved supplies to Ukraine, but reached agreement to restore flows of fuel and because the cut was in spring, not during the middle of winter, it did not affect supplies to western Europe.

Russia's differences with Ukraine have led it to propose two pipelines, the North Stream and South Stream, running north and south of the EU bloc, which would bypass current transit states.

BELARUS

Around 20 percent, or some 30 bcm a year, of the gas Russia exports to Europe passes through Belarus.

Belarus President Alexander Lukashenko failed on Monday to secure a firm promise of preferential gas prices from Russia in 2009 despite warning the Kremlin that undermining its ally's economy could backfire.