OREANDA-NEWS. June 18, 2015. This year the Government has managed to reduce the deficit of Naftogaz Ukrainy five times. Prime Minister of Ukraine Arseniy Yatsenyuk told in an interview to Channel 5.

"Do you know why we are facing the current situation regarding tariffs? Because the price of energy resources has not met the market level over 20 years. Well, we do not subsidize gasoline, do we? So you come to a gas station – there is the market price there. We have taken a decision 15 years ago about how much gasoline costs on the exchange, at a gas station, there is direct correlation. How does petrol differ from gas? It's the same energy product," he said.

"If a product costs \\$100, and you pay only \\$10 for it, it should be someone who pays extra \\$90? It was the Budget. This means that taxes from people, business, entrepreneurs were collected, loans were borrowed, and in 2014 due to the fact that in 10 years nothing was done, we allocated subsidies to NJSC Naftogaz Ukrainy, we just gave the money and it paid out all its debts. Exactly \\$10 billion," the Prime Minister underlined.

"How many hospitals, schools, roads, jobs could have been built and created with this money and how many energy efficient facilities could have been constructed to reduce consumption of heat, energy, everything? Just how many boilers could have been altered?" the Prime Minister said.

Arseniy Yatsenyuk stressed that this year the Government has managed to reduce the deficit of Naftogaz five times. "That was 10 billion last year. This year we expect 1.5-2 billion, depending on the future situation," he said.

"There is no other way except bringing tariffs to the market level. What is our goal? The purpose is the following - Ukraine has to become completely energy independent country within 10 years. This is our task. And we are moving towards this objective and in particular via market rates," Arseniy Yatsenyuk emphasized.

He recalled that rates should have met the market level within a year.

"We extended it for three years. We have provided a social norm - 200 cubic meters for citizens. We are gradually introducing new tariffs. We have launched a subsidy program," he said.

The Prime Minister reminded that next week four international auditing firms should provide their report on tariffs’ formation. However, he noted, now we can say that "tariffs do not meet the market level, because they are too understated."

Arseniy Yatsenyuk said it is easy to calculate: "Take the current natural gas market price. In Europe, it is sold on average for \\$250/tcm. Multiply it at the rate of national currency, add the cost of transit, value added tax, and we receive a figure that is much higher than that currently provided for a social norm at 200 cubic meters for the Ukraine's population."