Show leadership

The dispute between Ukraine and Russia on gas-related debts and deliveries is a matter of perspective. If energy provider Gazprom were merely a normal, private enterprise, then its latest decision to deliver to Ukraine only when payment is made in advance would be completely understandable. After all, Ukraine's state gas company owes Gazprom more than 4.5 billion dollars (3.32 billion euros). Any company driven by its bottom line would make future deliveries contingent upon the outstanding balance being paid and guarantees going forward.

However, Gazprom is not just an ordinary company. It's an enterprise operated by the Russian state and, as such, is part of the country's broader foreign policy framework.

Negotiations amidst a de facto war

What's more: Ukraine and Russia aren't your typical neighbors at the moment. In reality, an unspoken war has broken out between the two countries. How else can one interpret Russia's annexation of Crimea - a breach of international law - as well as the conflicts between Ukrainian government troops and the separatists in Donetsk and Luhansk, who are clearly getting support from Russia? Against that backdrop, the fact that the Kremlin does not officially recognize the new Ukrainian government centered on President Poroshenko and Prime Minister Yatsenyuk is almost an insignificant detail.

In light of this situation as a whole, it would be truly astonishing if Russian and Ukrainian negotiators would have reached an agreement on the gas dispute, which is very important to both sides. Hope for a compromise also rested with the European Union, which should seek a solution to the disagreement due to its own interests at the very least.

However, all of the parties now have some time. That's because even if Ukraine suddenly stops receiving gas from Russia for not paying off its debts and providing advance payments, the country's reserves still have enough energy to supply the country through the fall. For European consumers, there's also little reason for concern at the moment. It's in Gazprom's interest to live up to its delivery obligations to other European states and send Russian gas through Ukraine's pipe system on to Central Europe.

EU should lead, not moderate

But the failure of the most recent negotiations is a setback for the EU. The bloc must stop seeing itself as a moderator between two opposing parties in a conflict, who are just in need of some help to arrive at a compromise. In light of the general sense of acrimony, Kyiv and Moscow will not be in a position to achieve a solution in the foreseeable future.

For that matter, Kyiv and Moscow don't view the EU as a mere moderator, but instead as a key geopolitical player in this dispute. Brussels needs to show strength in leadership to force both sides into some arrangement. That means putting pressure on Kyiv to pay its debits and finally begin making changes to energy-intensive economy sooner rather than later. It also means exercising influence on Moscow to budge when it comes to setting the gas prices for Ukraine. Without this shift in Europe's role, the situation will only escalate further.