MILAN: Ukraine and Russia both signalled progress towards settling their festering row over gas Friday, raising hopes of an EU-backed resolution of the broader conflict embroiling the Soviet-era allies.
Russian President Vladimir Putin met his Ukrainian counterpart three times in the space of ten hours in Milan Friday, twice in the company of various European Union leaders then, finally, in their first private meeting since late August.
"We have some certain progress (on the gas issue) but left some details which need to be discussed," Ukrainian President Petro Poroshenko said after the final meeting, adding that he hoped a deal could be done at or before already-scheduled talks in Brussels next week.
"Before October 21, we hope to find a solution for the energy question," he said.
Putin also implied a deal was close and urged EU governments to help finalise the complex funding package required for it to happen.
French President Francois Hollande had earlier described a gas deal as "within reach," following a four-way meeting involving himself, Putin, Poroshenko and German Chancellor Angela Merkel.
EU-brokered talks with Ukraine and Russia have produced a draft accord whereby cash-strapped Kiev would pay $3.1 billion (2.4 billion euros) in unpaid bills to Moscow by end-October, with a new contract to cover subsequent deliveries.
If confirmed at Tuesday's talks in Brussels, this could represent a real advance.
Putin threatened earlier this week to cut supplies completely if no agreement was reached -- a move that could disrupt winter supplies to Europe.
Russia accounts for around one third of the EU's consumption, half of which transits via Ukraine, and previous disruptions, in 2006 and 2009, led to sharp spikes in prices.
In a sign of continuing uncertainty regarding the Russian economy, ratings agency Moody's downgraded Moscow's credit rating to Baa2 from Baa1 on Friday, citing the Ukraine crisis as one of the reasons.
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