MOSCOW: Gazprom cut shipments of natural gas to Ukraine on Monday after failing to resolve a debt dispute, rekindling concern about Russias reliability as an energy supplier.

Gazprom, Russias state-run export monopoly for natural gas, reduced deliveries to Ukraine by 25 percent, said a Gazprom spokesman, Sergei Kupriyanov. Gazprom would supply European consumers in full, he said.

The standoff echoes a pricing dispute in January 2006, when Gazprom turned off all Ukrainian exports of natural gas for three days, causing volumes to fall in the European Union. About a fifth of Russian natural gas supplies to Europe travels through Ukrainian pipelines.

“This still doesnt represent a crisis, just a greater degree of brinkmanship,” Geoffrey Smith, deputy head of research at Renaissance Capital Ukraine, said in an e-mail after the announcement. “The weather is warm and forecast to stay so, and storage both in Ukraine and further west is unlikely to be depleted after another mild winter.”

Kupriyanov said Feb. 29 that the state-controlled company had warned its European trading partners about the situation. “Gazprom is a reliable energy supplier, but we cannot and will not deliver gas without payment,” Kupriyanov said Monday.

Europe has been seeking to build pipelines from Central Asia to reduce dependence on Russian natural gas, while Gazprom is planning routes to supply Europe directly, circumventing transit countries like Ukraine.

“No one is innocent,” said Peter Halloran, chief executive officer of the Moscow-based Pharos Financial Group. “Both Russia and Ukraine are disrupting the supply chain to Europe. This gives impetus to build alternative pipelines to avoid regional politics.”

The EU energy commissioner, Andris Piebalgs, urged both sides to reach an agreement “that we hope is definitive,” his spokesman, Ferran Tarradellas Espuny, said last week in Brussels.

Prime Minister Yulia Timoshenko of Ukraine said over the weekend that she did not expect Gazprom to reduce deliveries because there had been no official notification of the threat.

The cutoff represents “an embarrassment” for Timoshenko, said Smith, of Renaissance Capital.

Supplies to NAK Naftogaz Ukrainy, Ukraines state oil and gas company, were cut by 30 million cubic meters, or 1 billion cubic feet, a day, or a quarter of usual deliveries, a Naftogaz spokesman, Valentyn Zemlyanskyi, said.

“We plan to continue gas talks with Russia,” Zemlyanskyi said, without saying when.

Ukraine averted a previous threat by Gazprom to cut supplies on Feb. 12 when President Viktor Yushchenko and his Russian counterpart, Vladimir Putin, reached an agreement in Moscow talks. Kupriyanov said Ukraine had failed to pay its debt in full and had not signed an agreement on future gas imports.

Ukraine owes about $600 million for 1.9 billion cubic meters of Russian gas it has received without a contract, Kupriyanov said. Gazprom has been supplying Russian fuel after Central Asian deliveries declined, he said last week.

Gazprom is also demanding that Ukraine approve the creation of two companies to handle the gas trade, replacing RosUkrEnergo, the only company currently allowed to import gas into Ukraine. Gazprom and Naftogaz would share ownership of the new companies. RosUkrEnergo, owned by Gazprom and two Ukrainian citizens, was set up to resolve the 2006 price dispute.

Timoshenko and ministers had rejected the Feb. 12 deal, calling on Gazprom to sell gas directly to Naftogaz.

E.ON, Germanys largest supplier of natural gas, expected to maintain normal deliveries to its customers after Gazprom cut shipments to Ukraine, an E.ON spokeswoman Astrid Zimmermann said by telephone. Zimmermann declined to comment on whether the company had seen any change in deliveries of Russian gas.

Burmese troops today sealed off a number of Buddhist monasteries at the centre of protests against the country’s military dictatorship.

As part of a violent crackdown that has killed at least 10 people, the ruling junta declared no-go zones around five key monasteries, including main protest sites at the Shwedagon and Sule pagodas in Rangoon, foreign diplomats in the country said.

Yesterday, a Japanese photographer, Kenji Nagai, 50, was among those killed in fierce clashes.

Thousands of protesters played a deadly game of cat and mouse with the police and troops, continually dispersing as they were attacked and reforming to taunt the security forces who used teargas, baton charges and live ammunition against them.

Today, crowds of people again baited soldiers in the centre of Rangoon, Burma’s main city, swearing at them and then running into side alleys when the troops feigned a charge, a witness said. Men were shouting at the soldiers in English: “Fuck you. Go fuck yourself,” Reuters reported.

Trucks of soldiers and riot police were sealing off the central city, near the Sule pagoda, by moving up wooden and barbed-wire barricades street by street.

At the UN general assembly in New York, the foreign secretary, David Miliband, called on the regime “to allow peaceful protest, encourage national dialogue and promote genuine reconciliation”.

“Let us today send a message to the monks on the streets of Burma: We support your demand for a democratic Burma,” he said late last night. “And let us take a message from the monks on the streets of Burma: the human desire for freedom knows no bounds of race or religion or region.”

Fewer monks were seen on the streets yesterday as up to 500 had been arrested and many others confined to their quarters by soldiers who raided six monasteries around the capital from dawn onwards. Leaders of the National League for Democracy were also rounded up.

Pools of blood remained in monastery dormitories and stairwells where the troops had smashed in windows and doors, and beaten the young novices as they lay sleeping. In some raids, shots were fired and a senior abbot at Moe Ngway monastery was said to have died later in the afternoon.

The ferocity of the attacks on the monks, the ransacking of monasteries that saw Buddhist relics vandalised and gold looted, according to diplomatic sources, shocked ordinary Burmese people, who revere the clergy.

It set the tone for a day that echoed months of violence in 1988. That pro-democracy uprising ended with the massacre of 3,000 students and monks.

Yesterday’s protests by Burmese people were more spontaneous and chaotic than those of the previous days when the monks had taken the lead, both protecting and being protected by their supporters.

Truckloads of soldiers and police were out in much greater force from early morning at strategic points around Rangoon. Barbed wire barricades blocked roads and empty prison trucks awaited their cargo as water canon and fire engines stood by.

“Clearly the military had calculated that seven or eight days of protests needed to be brought to a halt,” said Mark Canning, Britain’s ambassador to Burma. “I would imagine that people [the military] have gone back to the drawing board and concluded that they needed to turn up the measures further. We deplore that and think that sort of violence is going to make matters worse.”

Security forces on foot and in vans toured the city with loudspeakers, urging residents to clear the streets within 10 minutes or face “extreme force”, warnings that went unheeded among the crowds, who appeared not to care about the danger.

By midday a large, angry mob had gathered near the Sule pagoda, a focal point of earlier protests, despite the presence of large numbers of security forces at the Buddhist shrine.

About 3,000 demonstrators sat down in the road in front of the ranks of riot police, clapping and chanting, taunting the security forces - who took no action at first. But then police and soldiers pushed the crowd and began firing into the protesters, wounding at least four, though it was not clear how severely.

One of the demonstrators caught in the crossfire called the BBC on his mobile phone to relay the horror unfolding in front of him. “They have shot several times into the crowd,” he shouted, the panic around him clearly audible. “One person has been injured. They’ve used teargas. The injured person has been put in a car and taken off to hospital. They’ve used force on us.”

The onslaught scattered the panic-stricken protesters, who left sandals lying in the road. But they soon regrouped nearby and found themselves being pushed back again by the riot police. Their retreat was blocked by a phalanx of soldiers. Sandwiched between the two sets of security forces, the crowds rushed down a side street, and diplomats saw and heard volleys of shots, though were unsure if anyone was hit.

Calm was restored for a time before another wave of protesters appeared near the Sule pagoda to be confronted by the military. Again the troops opened fire and another four protesters fell.

At about the same time, western diplomats reported another standoff in the north-eastern Rangoon suburb of Damway, when an angry mob came upon four army trucks packed with troops.

Surrounded by the jeering crowds still seething over the treatment meted out to the monks during the overnight raids, the troops again fired their weapons.

Other crowds around the city were involved in sporadic clashes with the security forces, particularly those who tried to approach the monasteries where the troops were still maintaining a vigil.

In the second city, Mandalay, troops also shadowed protesting monks, who were baton-charged by riot officers. Many were injured but there were no reports of the soldiers opening fire.

CHEVRON, () warned that Q3 profit will be significantly below Q2’s $5.4 bil, due to weaker refining margins. Shares fell.

AMR, () parent of American Airlines, said Priceline.com () will be its exclusive partner for opaque tickets. Customers who buy these tickets do not know the name of the airline or schedule until the sale is completed.

STARBUCKS, () the coffee giant, said it’s recalling 250,000 plastic children’s cups due to a potential choking hazard. The Chinese-made cups could break if dropped, leaving small pieces a child could choke on.

ORACLE, () will buy LogicalApps, a provider of automated application management systems, for an undisclosed sum.

INT’L PAPER, () a paper and forest products company, sees Q3 EPS below views of 63 cents, but above Q2’s 52 cents. It cited weaker land sales revenue. Shares fell.

QUANTUM, () , a storage device maker, filed a patent suit vs. Riverbed Technology. () Shares fell.