Russian President Vladimir Putin warned of possible disruption to Europe's gas supply on Thursday, as the U.S. confirmed it would send additional non-lethal military support to Ukraine.
Speaking at an annual televised question-and-answer session in Moscow, Putin said Russia would give Ukraine a month to pay off its gas debts, but would then switch to a "complicated" pre-payment scheme which could disrupt supply.
Gas giant Gazprom, in which the Kremlin has a majority stake, claims Ukraine owes it more than $2.2 billion.
"It's a complicated settlement and might lead to disruption of supply of gas to our European consumers. We can cut it off right now. But we will wait another month," Putin said.
The unfolding dispute between Ukraine and Russia has led to fears of a disruptions in gas supply to Europe, given that Russia supplies around a third of the continent's natural gas, and that some of that supply is delivered through pipelines running through Ukraine.
On Thursday, the European Commission agreed to gas-security talks with Russia, and urged Putin not cut off supplies to Ukraine.
Later on Thursday, U.S.Defense Secretary Chuck Hagel said America would send additional help to Ukraine.
"Earlier this morning I called Ukraine's acting defense minister to tell him that President Obama has approved additional non-lethal military assistance for health and welfare items and other supplies," Hagel said at a press conference.
The U.S. has called for Russia to pull back its forces from the border, and from the Crimean region of Ukraine. It has also called on Russia to ask armed pro-Russia groups in eastern Ukraine to stand down and disarm.
Also at Thursday's question-and-answer session, Putin admitted for the first time that Russian forces were present in Crimea even before its annexation last month. However he refuted claims that they were currently operating in the eastern part of Ukraine.
"We had to take unavoidable steps, so that events did not develop as they are currently developing in southeast Ukraine," Putin said, according to Reuters news agency. "Of course our troops stood behind Crimea's self-defense forces."
Putin added that the use of force by Ukraine against pro-Russian separatists was a "grave crime." He said Ukraine should instead be creating a dialogue with the Russian-speaking community in the area.
The Russian leader added that he very much hoped he would not have to use military force in Ukraine, and believed that the two countries would eventually reach a "mutual understanding."
Snowden quizzes Putin
Fugitive whistleblower and former U.S. security agency contractor, Edward Snowden, also took part in the question-and-answer session.
Snowden asked Putin whether Russia intercepted or analyzed communications between its citizens. Putin replied that the country did not conduct "massive, uncontrolled" surveillance, and that Russian laws would not allow that.
"I used to work for intelligence service(s) like you. We will talk the same professional language—our intelligence efforts are regulated by our law," Putin said to Snowden.
"I hope we won't do that and we don't have the money or technical devices that they have in the States."
Putin's comments came as representatives from the European Union (EU), U.S., Ukraine and Russia met in Switzerland in the hope of cooling the crisis in Ukraine, which claimed more lives overnight.
U.S. Secretary of State John Kerry, the EU's High Representative Catherine Ashton, Russian Foreign Minister Sergei Lavrov and Ukrainian Foreign Minister Andrii Deshchytsia met for the talks.
On Thursday afternoon, Reuters quoted a Western official speaking on condition of anonymity, who said the four powers were working on a joint statement.
Three dead in Ukraine
On Wednesday night, three pro-Russian protesters were killed,13 wounded and 63 arrested in a clash at Mariupol military base, about 40 kilometers from the Russian border, according to Ukraine's interior minister, Arsen Avakov.
Avakov posted on his Facebook site Thursday morning, saying that a military unit was attacked overnight by a group of 400 people. The "gang of attackers" opened fire on the military installation after the guards refused to switch sides, he said. They threw incendiary weapons and Molotov cocktails, before the military guards responded and the protesters were scattered and disarmed.
Over the past weeks, pro-Russian separatists have taken over buildings in 10 cities in the eastern part of Ukraine, according to Reuters. This part of the country is mainly Russian-speaking and protesters dislike Ukraine's new government, which is more popular in the western side on Ukraine.
Declan Ganley, chairman and CEO of Rivada Networks, remained skeptical and said Thursday's talks in Geneva would not generate any resolutions.
"I think (Putin) is laughing at us...he's stringing us along," he told CNBC on Thursday. "We already know how this plays out .. why we think this is going to be any different is a mystery to me."
Russian stocks closed 0.5 percent higher on Thursday and the Russian ruble appreciated slightly against the U.S. dollar. The yield on the Russian government's 10-year benchmark bond stood to 9.12 percent, rising higher this month after starting April at 8.73 percent.
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