* Ukraine seeks more exposure to spot market in Europe
* Gazprom's Miller says Ukraine won't afford spot market gas
MOSCOW, March 25 Ukraine's plan to buy more gas
from Europe and reduce imports from Russia will not work because
European prices are rising, Russia's Gazprom said,
signalling it will not budge in a price dispute with Kiev.
Ukraine, a transit route for more than half of Russian gas
shipped to the European Union, wants to pay less for gas from
Russia because it says a 2009 deal with Moscow set an exorbitant
price, and aims to buy more from Europe.
But Alexei Miller, head of Russian state gas monopoly
Gazprom, said on Monday that spot gas prices, which have spiked
recently in Europe, would be unaffordable for Ukraine.
"The price for Russian gas, which is being supplied to
Ukraine, is significantly lower than the spot price, which has
settled in continental Europe," Miller told reporters.
"Ukraine will not be able to bear the spot prices," he said.
Gazprom sells gas to Ukraine at a fixed price of $430 per
1,000 cubic metres, higher than the recent average European spot
price but European prices are rising.
"(They are) almost twice as much as Gazprom sells to Ukraine
under the long-term agreement," Miller said.
The European market is volatile though. On Friday the spot
price of gas in the London market jumped to above 150 pence per
therm, or around $630 per 1,000 cubic metres, due to
unseasonally cold weather. By Monday, however, it had fallen to
100 pence per therm, only around 5 pence per therm above the
Russian oil-linked gas price.
The March average UK spot gas price is around 85.6 pence a
therm, so still some 10 pence below the Russian price.
Ukraine began importing a small volume of gas from Europe
last year and wants to import up to 8 billion cubic metres of
gas a year from central Europe to replace expensive Russian
Russian President Vladimir Putin and Ukrainian leader Viktor
Yanukovich discussed the price dispute earlier this month but
there was no breakthrough to end the standoff.
Moscow has demanded concessions as a condition for reviewing
the price agreement, such as Ukraine joining a Russia-led trade
bloc or giving up control of its pipeline network.
Ukraine agreed its gas contract with Russia under former
prime minister Yulia Tymoshenko. She was sentenced to seven
years in prison in October 2011 on abuse-of-office charges,
including for her part in signing the gas deal with Russia.
(Reporting by Vladimir Soldatkin; Editing by Susan Fenton)