Putin admits Crimea involvement; warns on gas

Russian President Vladimir Putin has for the first time admitted that Russian forces were present in Crimea before its annexation last month but refuted claims they are 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.”

Speaking at an annual televised question-and-answer session in Moscow, Putin added that the use of force by the interim government in Ukraine against pro-Russian separatists was a “grave crime.” He added that Kiev should instead be creating a dialogue with the Russian-speaking community in the area.

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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 find a “mutual understanding.”

The topic of gas supplies was also raised at the session, after the European Commission on Thursday agreed to gas-security talks with Russia, and urged Putin not cut off supplies to Ukraine.

Putin said it would wait for a month for Ukraine to pay off its gas debts but would then switch to a pre-payment scheme. 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.

Snowden quizzes Putin

Fugitive whistleblower and former NSA contractor Edward Snowden also took part in the 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.

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“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.”

Sasha Mordovets | Getty Images

Sasha Mordovets | Getty Images

Putin’s comments come as representatives from the European Union, U.S., Ukraine and Russia met in Geneva in the hope of cooling the escalating crisis in Ukraine, which claimed yet more lives overnight.

Three dead in Ukraine

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 posted on his Facebook site Thursday morning, saying that a military unit was attacked overnight by 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, he added.

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 are angry at Ukraine’s new government, which is more popular in the western side on Ukraine.

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Declan Ganley, chairman and CEO of Rivada Networks, remains skeptical and believes Thursday’s talks in Geneva will not generate any resolutions.

“I think (Putin) is laughing at us…he’s stringing us along,” he told CNBC Thursday. “We already know how this plays out .. why we think this is going to be any different is a mystery to me.”

Geneva talks

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 will all meet in Switzerland for multilateral talks on Thursday. Despite the news of conflict in the region, the fact that Russian and Ukrainian representatives are meeting face-to-face has given some optimism for the talks as Russia has yet to recognise the interim government in Kiev.

“The expectations are that we will find a good solution that we will all benefit from,” Deshchytsia told CNBC on Wednesday evening.”And this expectation is the de-escalation on the ground…it’s always possible if there’s a will.”

At a press conference Wednesday, Deshchytsia added that the same scenario was happening in eastern Ukraine that had happened in the Crimea Peninsula, adding that Ukraine’s acting government had evidence that Russians were involved in the uprising.

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The U.S. has stated that it wants the Russian government to pull its forces back from the border and from the Crimean region of Ukraine. It has also called upon the Russians to call for armed separatist groups in eastern Ukraine to stand down and disarm.

Russian stocks were flat 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. Brent oil steadied above $110 a barrel, near a six-week high, with the tensions in Ukraine giving the commodity a risk premium.

During his Q&A session, Putin also found the time to speak of negotiations with neighboring China, saying that relations between the two had developed to an all-time high.

“It..will significantly influence the modern architecture of international relations,” Putin said, quoted by Reuters, but stated that they were “not considering the question of a military-political alliance.”