Ukraine says seeking long-term gas deal with Russia

KIEV, March 14 (Reuters) - Ukraine is seeking a long-term agreement on gas supplies from Russia's Gazprom (GAZP.MM), Prime Minister Yulia Tymoshenko said on Friday, after the two former Soviet neighbours resolved their latest energy squabble.

Kiev on Thursday signed a deal with Gazprom that detailed supply volumes and prices for 2008, to the relief of European countries that get almost a quarter of their gas from Russia via Ukraine and are wary of any cuts to supplies caused by disputes.

But the two countries, whose frequent gas disagreements have jangled EU nerves after a brief supply cut in January 2006, have not yet signed a deal for next year.

"We would like to have strategic relations with Gazprom, so that our contracts with Gazprom could last three, five, or if possible, 10 years, in which prices would be forecast and the balance of supply be stable," Tymoshenko told a news conference.

"In relation to 2009 supplies, I am convinced that an agreement will be acceptable to the Ukrainian economy and gas prices will be raised gradually," she said.

According to Thursday's deal, Gazprom will supply almost 50 billion cubic metres of Central Asian gas at $179.5 per 1,000 cubic metres before the end of the year.

But that price will be put into question from 2009 as Central Asian suppliers will raise their prices from next year to levels that Gazprom describes as close to European rates.

Russia wants its fellow former Soviet states to start paying market prices for gas -- Europe is charged around $380 per 1,000 cubic metres, according to a Gazprom source -- and has raised prices sharply for Ukraine from a mere $50 in 2005.

Tymoshenko's long-standing charges of corruption in the region's energy sector and politicisation of the gas issue, especially during her last tenure as prime minister in 2005, has made Moscow extremely wary of her.

She claimed victory on Friday after Gazprom agreed to cut out middlemen in the gas trade -- one of her chief complaints -- ending years of opaque schemes that have caused tensions.

"From the moment we sign this agreement, all instability on the gas market will disappear," she said.

"I have no doubt that Ukraine and Russia will find agreement not just on the gas (issue), but in all issues where there has been misunderstanding, conflict or opposition," she said. (Reporting by Natalya Zinets; writing by Sabina Zawadzki; editing by James Jukwey)