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A high-level effort to resolve the gas crisis in Europe inched forward Thursday after Gazprom, the Russian natural gas monopoly, said it would resume shipments as soon as monitors were in place to verify that  Ukraine was not tapping supplies meant for European Union customers.

But Ukraine balked at Gazprom's demand that Russian monitors be allowed to inspect the Ukrainian pipeline network, frustrating a deal amid an increasingly serious fuel shortage.

Aleksei Miller, Gazprom's chief executive, said in Brussels that monitors from 10 countries would help verify that the gas arriving at Ukraine's eastern border for European customers was being shipped to the west. He said that once the monitors were fully deployed, "we will resume gas supplies to ensure 100 percent of European transit."

Oleh Dubyna, chief executive of Naftogaz, the Ukrainian national energy company, said Ukraine was ready to resume pumping as soon as Gazprom restarted shipments, on the condition that Gazprom provided gas to run the pipeline system. The Ukraine government also signed a protocol with the EU to accept European monitors, who could be in place Friday.

But EU officials in Brussels said that Gazprom refused to restart exports unless Russian experts were included in the monitoring group in Ukraine, and that Ukraine would not accept the condition.

The EU energy commissioner, Andris Piebalgs, said he did not know when gas service would be restored, despite the fact that European citizens were "suffering a lot."

The impact of the gas cuts was most painful in southeastern Europe, where hundreds of thousands of people in Serbia, Bosnia and Bulgaria were without heat. In a European parliamentary committee hearing Thursday, Evgeni Kirilov, a member from Bulgaria - which depends almost completely on Russia for its gas and has reserves sufficient for only a few more days - said he could not understand "how two of the biggest countries in Europe can be so uncivilized and irresponsible." He added: "We are hostage to this irresponsibility."

Christopher Beazley, a British member, warned Russia that it was harming relations with Europe. He pointed to "cyberwars in Estonia" - a wave of Internet attacks was launched from Russia against Web sites in Estonia in 2007 during a political dispute - as well as the brief war with Georgia last summer, and now the cutoff of gas.

"Mr. Putin must understand that these tactics will not work," he said, referring to Prime Minister Vladimir Putin of Russia.

Gazprom halted all shipments to Ukraine for its own use on Jan. 1, then stopped gas exports for transshipment through Ukraine on Wednesday, saying its western neighbor was taking gas from the pipeline meant for EU customers. The dispute has left Ukraine  and 17 European countries with either no gas supplies or a sharp reduction in supplies in the middle of winter.

The dispute centers on Russia's desire to sharply raise the price for the gas it sells to Ukraine, as well as Ukraine's desire to raise the fees that it charges Gazprom for the use of its pipeline network to the European Union. Gazprom is seeking to raise the price Ukraine pays for gas to $450 per 1,000 cubic meters from $179.50 last year. Ukraine has reportedly offered a little more than $200 per 1,000 cubic meters. Russia also wants to collect what it says are fines for late payments on previous shipments.

Speaking on Russian television Thursday, Putin offered to raise the transit fees that Russia pays to ship gas across Ukraine, saying the two countries needed to shift, "as quickly as possible, to a market relationship."

In exchange for a market rate, he said, Russia would pay transit fees of $3 to $4 for each 1,000 cubic meters transported 100 kilometers, or 62 miles. Gazprom last year paid Ukraine $1.60 and had said it would pay $1.70 this year.

Putin blamed Ukraine's leaders for the shutoff and suggested they were unwilling to make a deal that would cut out a middleman company, RosUkrEnergo, owned by a business ally of the Ukrainian president, Viktor  Yushchenko.

Putin said he suspected some politicians of seeking to use proceeds from gas trading "as financial resources in future political campaigns."

Both Ukraine and Russia rank near the bottom of Transparency International's ranking of official corruption around the world. In the anti-corruption group's 2008 list, Ukraine was in 134th place and Russia 147th.

European officials had previously described the dispute as being purely commercial, but Piebalgs, the EU energy commissioner, said Thursday that there was "a political dimension." Russia's relations with its western neighbor are complicated by the fact that Ukraine's western-leaning government wants to become a NATO member against Russia's wishes.

In Prague the Czech deputy prime minister, Alexandr Vondra, said the dispute had led to serious difficulties for the European Union. Speaking after a meeting with EU ministers in Prague, he said EU nations were being "exposed to completely unacceptable blackmail." The credibility of Russia as a reliable gas supplier, and of Ukraine as a transit nation, had been called into doubt, he added.

The German chancellor, Angela Merkel, said after talks with President Nicolas Sarkozy of France that Europeans "expect the talks between Ukraine and Russia to yield quick results."

"The genesis of this is in Russia's move away from barter agreements with the former Soviet republics toward market prices," said Andrew Neff, an energy analyst at IHS Global Insight in Ankara. "You can blame either one, but both sides seem to have shot themselves in the foot."

Ukraine is gambling that the longer it holds out, the more likely that Gazprom will have to give in and offer it subsidized gas, he said. And with many Europeans facing the prospect of unheated homes, Russia's refusal to resume exports over the question of monitors would probably strike many as pure obstructionism. "Europeans want to get the gas supplies through Ukraine, period," he said.

Under such a deal, Neff said, Russia would supply the gas, ensuring the security of its gas exports, Ukraine would supply the existing physical infrastructure, and the Europeans would be expected to help finance renovation and modernization of the network in exchange for reliable gas imports.

(We recommend: Read about the Ukraine’s Economy, here)