MOSCOW (AP) -- Russia on Monday said it would cut off gas supplies to Ukraine as a payment deadline passed and negotiators failed to reach a deal on gas prices and unpaid bills.

The decision does not immediately affect the gas flow to Europe, but could disrupt the long-term energy supply to the region if the issue is not resolved, analysts said.

Gazprom spokesman Sergei Kupriyanov said that since Ukraine had paid nothing for the gas by Monday Moscow has no legal grounds to supply Ukraine any more.

"Gazprom supplies to Ukraine only the amount that has been paid for, and the amount that has been paid for is zero," Kupriyanov said Monday morning.

The pipeline to Ukraine also carries gas meant for Europe, but Kupriyanov said that the supply to Europe will continue as planned. Ukraine has the obligation to make sure the gas will reach European customers, he said.

However, Gazprom has notified the European Commission of "a possible disruption in the gas transit" in case Ukraine decides to siphon off the gas, the company said.

Analyst Tim Ash at Standard Bank PLC said Russia was likely to cut off only the gas meant for Ukraine, but that Ukraine could in theory simply take what it wants since the gas is intermingled. That would result in a shortage in pipelines to Europe that could hinder the buildup of stored gas ahead of the winter heating season when demand is higher.

"So the message is that this is unlikely to bring a short-term hit to gas supply in Europe, but it will build up problems for the winter unless a deal is reached quickly," he said in an email.

Ukraine has been chronically behind on payments for the gas needed to heat homes and fuel its industries. The gas conflict is part of a wider dispute over whether Ukraine aligns itself with Russia or with the European Union.

It comes in the midst of the severe crisis in relations between the two countries that has followed Russia's annexation of Crimea in March. Ukraine accuses Russia of supporting a separatist insurgency in its eastern regions, which Russia denies.

On Saturday, pro-Russian separatists shot down a Ukrainian troop transport, killing all 49 people aboard. Ukrainian demonstrators spattered the Russian Embassy in Kiev with paint and eggs and overturned cars. In Moscow, police detained several men who were throwing flares at the Ukrainian Embassy.

Gazprom offered the previous president, Viktor Yanukovych, a discounted price of $268.50 per thousand cubic meters after he backed out of an economic and political agreement with the EU under pressure from Moscow.

That price was cancelled April 1 and raised to $485 per thousand cubic meters. Russia has now offered $385, but Ukraine insists on the old discounted price. Gazprom has tolerated the late payments but now says Ukraine owes a total of $4.458 billion for gas from last year and this year.

Russia wanted a payment of $1.95 billion for past-due bills by 9 a.m. Kiev time Monday. As the deadline passed Gazprom issued a statement that it would start demanding payment in advance for gas.

Gazprom announced on Monday that it is suing Ukraine's state energy company Naftogaz in an international court for the $4.5 billion. Naftogaz said it has also filed a suit against Gazprom, seeking a "fair and market-based price" for gas, as well as a repayment of $6 billion for what it said were overpayments for gas from 2010.

The European Commission said in a statement that Ukraine was ready to accept a compromise in talks in Kiev of paying $1 billion now and more later, but Russia didn't accept the offer.

European Union energy official Guenther Oettinger said he was "not pessimistic" that agreement could eventually be reached.

Russian Deputy Prime Minister Arkady Dvorkovich told Russian news agencies on Monday that the decision on what to do next will be made following a meeting between Gazprom CEO Alexei Miller and Russian President Vladimir Putin.

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McHugh contributed to this report from Kiev, Ukraine.

Russia to cut off Ukraine's gas supply

Negotiators fail to reach a deal on $1.95 billion in unpaid gas bills Moscow says it is owed.
Deadline passes

NAIROBI, Kenya (AP) — Dozens of extremists wielding automatic weapons attacked a small Kenyan coastal town for hours, assaulting the police station, setting two hotels on fire, and spraying bullets into the street. At least 48 people were killed, officials said Monday.

The assault in Mpeketoni began around 8 p.m. local time on Sunday night as residents were watching World Cup matches on TV and lasted until early Monday, meeting little resistance from Kenya's security forces.

At the Breeze View Hotel, the gunmen pulled the men aside and ordered the women to watch as they killed them, saying it was what Kenyan troops are doing to Somali men inside Somalia, a police commander said on condition of anonymity because he was not authorized to share that detail of the attack.

Authorities blamed al-Shabab, Somalia's al-Qaida-linked terror group, who have vowed to carry out terror attacks to avenge the Kenyan military presence in Somali. Along with its Somali fighters, the group also has many Kenyan adherents.

Kenya's top police commander, David Kimaiyo, said the death toll was 48.

A police spokeswoman said authorities believe that several dozen attackers took part.

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A member of the Kenyan security forces observes the remains of vehicles destroyed by militants, in t …

Mpeketoni is about 20 miles (30 kilometers) southwest of the tourist center of Lamu. Any tourism in Mpeketoni is mostly local, with few foreigners visiting the region. The town is about 60 miles (100 kilometers) from the Somali border. Mpeketoni is about 360 miles (600 kilometers) from the capital, Nairobi.

Kenya has experienced a wave of gunfire and explosive attacks in recent months. The U.S., U.K., France, Australia, and Canada have all recently upgraded their terror threat warnings for the country. U.S. Marines behind sandbag bunkers are now stationed on the roof of the U.S. Embassy in Nairobi.

The Interior Ministry said that at about 8 p.m. Sunday two minivans entered the town. Militants disembarked and began shooting. Kenya's National Disaster Operations Center said military surveillance planes were launched shortly afterward.

The nearby town of Lamu is a UNESCO World Heritage Site and is the country's oldest continually inhabited town. The region saw a spate of kidnappings of foreign tourists in 2011 that Kenya said was part of its motivation for attacking Somalia. Since those attacks and subsequent terror warnings tourism has dropped off sharply around Lamu.

At least 67 people were killed in September when four al-Shabab gunmen attacked an upscale mall in the Kenyan capital, Nairobi. Kenya sent it troops to Somalia in October 2011.

48 killed in terror attack in Kenya

Authorities blame an al-Qaida-linked group from Somalia for the assault on a small coastal town.
Hotels, police station targeted

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BAGHDAD (AP) — Sunni militants captured a key northern Iraqi town along the highway to Syria early on Monday, compounding the woes of Iraq's Shiite-led government a week after it lost a vast swath of territory to the insurgents in the country's north.

The town of Tal Afar, with a population of some 200,000 people, was taken just before dawn, Mayor Abdulal Abdoul told The Associated Press.

The town's ethnic mix of mostly ethnic Shiite and Sunni Turkomen raises the grim specter of large-scale atrocities by Sunni militants from the al-Qaida-inspired Islamic State of Iraq and the Levant, or ISIL, who already claim to have killed hundreds of Shiites in areas they captured last week.

Tal Afar's capture comes a week after Sunni militants took Iraq's second-largest city, Mosul, and Saddam Hussein's hometown of Tikrit in a lightening offensive that has plunged Iraq into its worst crisis since the 2011 withdrawal of U.S. troops.

A resident in Tal Afar, 420 kilometers (260 miles) northwest of Baghdad, confirmed the town's fall and said over the telephone that militants in pickup trucks mounted with machineguns and flying black jihadi banners were roaming the streets as gunfire rang out.

The local security force left the town before dawn, said Hadeer al-Abadi, who spoke to the AP as he prepared to head out of town with his family. Local tribesmen who continued to fight later surrendered to the militants, he said.

"Residents are gripped by fear and most of them have already left the town for areas held by Kurdish security forces," said al-Abadi.

Another resident, Haidar al-Taie, said an aircraft was dropping barrel bombs on militant positions inside the town on Monday morning and that many Shiite families had left the town on Sunday, shortly after fighting broke out.

Security at the U.S. Embassy in Baghdad was strengthened and some staff members were sent elsewhere in Iraq and to neighboring Jordan, the State Department said Sunday. A military official said about 150 Marines have been sent to Baghdad to help with embassy security.

The State Department also issued a travel warning for Iraq on Sunday night, which cautioned U.S. citizens to avoid "all but essential travel to Iraq." The warning said the Baghdad International Airport was "struck by mortar rounds and rockets" and that the international airport in Mosul has also been the target of militant assault.

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FILE - This May 27, 2014, file photo shows President Barack Obama, standing in the White House Rose …

However, a senior Baghdad airport official, Saad al-Khafagi, denied that the facility or surrounding areas have been hit. State-run Iraqiya television also denied the attack, quoting the Ministry of Transport.

A city of seven million, Baghdad is not in immediate danger of falling in the hands of the Sunni militants, but a string of bombings on Sunday killed 19 people and wounded more than 40. The violence added to the nervousness of the Iraqi capital's residents.

Security has been tightened around the city, particularly on its northern and western edges, and food prices have dramatically gone up because of the transportation disruptions on the main road heading north from the capital.

On Monday, Interior Ministry spokesman, Brig. Saad Maan Ibrahim, told a press conference that Iraqi security forces killed 56 "terrorists" and wounded 21 in operations just outside the capital over the last 24 hours. He made no mention of Tal Afar and left without taking any questions.

Tal Afar is only 150 kilometers (93 miles) from the border with Syria, where ISIL is fighting against President Bashar Assad's government and controls territory abutting the Iraqi border. It lies on a main highway heading from Mosul to Syria, boosting the Islamic State's drive to link areas under its control on both sides of the border.

Tal Afar's capture came just hours after Shiite Prime Minister Nouri al-Maliki, addressing volunteers joining the security forces, vowed to retake every inch of territory seized by the militants.

"We will march and liberate every inch they defaced, from the country's northernmost point to the southernmost point," al-Maliki said. The volunteers responded with Shiite chants.

Fighting in Tal Afar began on Sunday, with Iraqi government officials saying that ISIL fighters were firing rockets seized from military arms depots in the Mosul area. They said the local garrison suffered heavy casualties and the main hospital was unable to cope with the wounded, without providing exact numbers.

Over the weekend, militants posted graphic photos that appeared to show their gunmen massacring scores of captured Iraqi soldiers. The pictures, on a militant website, appear to show masked ISIL fighters loading the captives onto flatbed trucks before forcing them to lie face-down in a shallow ditch with their arms tied behind their backs. The final images show the bodies of the captives soaked in blood after being shot at several locations.

Iraq's chief military spokesman Lt. Gen. Qassim al-Moussawi confirmed the photos' authenticity and said he was aware of cases of mass murder of captured Iraqi soldiers in areas held by ISIL.

He told the AP that an examination of the images by military experts showed that about 170 soldiers were shot to death by the militants after their capture.

Captions on the photos showing the soldiers after they were shot say "hundreds have been liquidated," but the total numbers could not be verified.

U.S. State Department spokeswoman Jen Psaki said Sunday that a militants' claim of killing Iraqi troops "is horrifying and a true depiction of the bloodlust that those terrorists represent." She added that an ISIL claim that 1,700 were killed could not be confirmed by the U.S.

While the actual numbers were impossible to verify, the claim and the photos are likely to stoke Shiite fears of sectarian mass murder — precisely what the militants hoped would be achieved by boasting of the killings.

U.N. Secretary-General Ban Ki-moon said Monday that the reports of Islamic militants massacring Iraqi soldiers was "deeply disturbing" and warned in a statement against sectarian rhetoric that could inflame the conflict and carry grave implications for the entire region.

The grisly images could also sap the morale of Iraq's security forces and heighten sectarian tensions.

Thousands of Shiites are already heeding a call from their most revered spiritual leader to take up arms against the Sunni militants who have swept across the north in the worst instability in Iraq since the U.S. withdrawal in 2011.

ISIL has vowed to take the battle to Baghdad and cities farther south housing revered Shiite shrines.

Iraqi militants capture another town

Sunni insurgents seize the northern Iraqi town of Tal Afar in the latest blow to the Shiite-led government.
Specter of atrocities

BAKERSFIELD, Calif. (AP) — Firefighters were racing to control a wildfire that threatened more than 500 homes in central California before hotter, drier weather sets in later in the week.

By later Sunday, the fire had burned through 3.1 square miles of trees and brush in and around the Sequoia National Forest, coming within a mile of a community about 30 miles northeast of Bakersfield.

Authorities have called on residents of the threatened homes to evacuate.

While firefighters stopped the flames from reaching homes in Wofford Heights, officials anticipated that the fire will spread toward the community near Lake Isabella, a popular recreation spot.

"It's moving toward areas that have not been burned," fire spokesman Jay Nichols said.

The Shirley Fire has destroyed at least two structures, Nichols said. It was 10 percent contained.

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The Shirley Fire continues to burn Sunday, June 15, 2014 near Rancheria Road in the Alta Sierra area …

The blaze broke out Friday night in remote area northwest of the lake and exploded late Saturday as dry winds pushed the flames toward homes, prompting Kern County Sheriff's deputies to knock on doors into the night to urge residents to leave.

More than 1,100 firefighters were battling the blaze in steep, rugged terrain. They were aided by retardant-dropping air tankers and helicopters that can fly through the night. They were scooping water from the lake to use against the fire.

More crews were expected to join the fight. Authorities planned to keep the augmented crews working through a "swing shift" so they don't lose any time during shift changes to make progress, Forest Service spokeswoman Jennifer Chapman said.

"Our current outlook for the forecast is such that we are really ramping up suppression operations over the next couple of days because it's going to be even hotter and dryer at the end of the week," she said.

The Forest Service said that camping, horseback riding, rafting and other activities in the Sequoia district were so far unaffected by the blaze.

Wildfire threatens 500 homes in central Calif.

Hotter, drier conditions expected later this week add to an already urgent situation.
In and near Sequoia National Forest

MOSCOW (AP) — Russia on Monday cut gas supplies to Ukraine as a payment deadline passed and negotiators failed to reach a deal on gas prices and unpaid bills amid continued fighting in eastern Ukraine.

The decision does not immediately affect the gas flow to Europe, but could disrupt the long-term energy supply to the region if the issue is not resolved, analysts said.

Gazprom spokesman Sergei Kupriyanov said that since Ukraine had paid nothing for the gas by Monday, from now on the company would demand that Ukraine pay in advance for any future deliveries.

"Gazprom supplies to Ukraine only the amount that has been paid for, and the amount that has been paid for is zero," Kupriyanov said Monday morning.

Ukraine's Naftogaz company head Andriy Kobolev said Russia had cut the supply of gas to Ukraine. He added that Ukraine can manage without Russian gas until December.

The pipeline to Ukraine also carries gas meant for Europe, but Kupriyanov said that the supply to Europe will continue as planned. Ukraine has the obligation to make sure the gas will reach European customers, he said.

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The headquarters of Russia's state-run natural gas giant Gazprom in Moscow, Russia, Monday, June 16, …

However, Gazprom has notified the European Commission of "a possible disruption in the gas transit" in case Ukraine decides to siphon off the gas, the company said.

Analyst Tim Ash at Standard Bank PLC said Russia was likely to cut off only the gas meant for Ukraine, but that Ukraine could in theory simply take what it wants since the gas is intermingled. That would result in a shortage in pipelines to Europe that could hinder the buildup of stored gas ahead of the winter heating season when demand is higher.

"So the message is that this is unlikely to bring a short-term hit to gas supply in Europe, but it will build up problems for the winter unless a deal is reached quickly," he said in an email.

Sabine Berger, an European Union spokeswoman, said in Brussels there was no official information as to changes in gas supply to the EU, and that as far as she knew, the flows remained "normal."

Ukraine has been chronically behind on payments for the gas needed to heat homes and fuel its industries. The gas conflict is part of a wider dispute over whether Ukraine aligns itself with Russia or with the European Union.

View gallery

European Union energy chief Guenther Oetinger talks on the phone outside the government building in …

It comes in the midst of the severe crisis in relations between the two countries that has followed Russia's annexation of Crimea in March. Ukraine accuses Russia of supporting a separatist insurgency in its eastern regions, which Russia denies.

On Saturday, pro-Russian separatists shot down a Ukrainian troop transport, killing all 49 people aboard. Ukrainian demonstrators spattered the Russian Embassy in Kiev with paint and eggs and overturned cars. In Moscow, police detained several men who were throwing flares at the Ukrainian Embassy.

In December, Gazprom offered the previous president, Viktor Yanukovych, a discounted price of $268.50 per thousand cubic meters after he backed out of an economic and political agreement with the EU under pressure from Moscow.

That price was cancelled April 1 and raised to $485 per thousand cubic meters. Russia has now offered $385, the price that Ukraine was paying until December, but Kiev insisted on a lower price. Gazprom has tolerated the late payments but now says Ukraine owes a total of $4.458 billion for gas from last year and this year.

Russia wanted a payment of $1.95 billion for past-due bills by 9 a.m. Kiev time Monday. As the deadline passed Gazprom issued a statement that it would start demanding payment in advance for gas.

View gallery

Ukraine Energy Minister Yuriy Prodan to speak to reporters outside the government building in Kiev, …

Gazprom announced on Monday that it is suing Ukraine's state energy company Naftogaz in an international court for the $4.5 billion. Naftogaz said it has also filed a suit against Gazprom, seeking a "fair and market-based price" for gas, as well as a repayment of $6 billion for what it said were overpayments for gas from 2010.

Ukrainian Prime Minister Arseniy Yatsenyuk angrily rejected the Russian position, saying that "we are not going to give in to Russian pressure... we are not going to subsidize Gazprom." He said Ukraine would press in the arbitration court for prices set "honestly, openly and on market principles."

In Moscow, Russian Prime Minister Dmitry Medvedev said at a meeting with the Gazprom chief and other officials that the Ukrainian position was "absurd."

The European Commission said in a statement that Ukraine was ready to accept a compromise in talks in Kiev of paying $1 billion now and more later, but Russia didn't accept the offer.

Berger said EU energy commissioner Guenther Oettinger remains committed to helping broker a deal between Kiev and Moscow.

"We stand ready to act as a mediator in these talks to facilitate a compromise, but for the moment, there are no new dates set," Berger said.

One reason for EU involvement is the current state of Ukrainian gas reserves. Berger said they now stand at around 13.5 billion cubic meters. For the EU to be assured to enough gas for the coming winter, those reserves should be at 18-20 billion cubic meters at the end of the summer, Berger said.

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McHugh reported from Kiev, Ukraine. Vladimir Isachenkov in Moscow contributed to this report.