Cracks were starting to appear in the Nato military alliance today after Slovakia warned of retaliation against Ukraine - including withholding aid - if a solution is not found to Kyiv's decision to shut off Russian gas.

       The threat came from Slovakia’s Prime Minister Robert Fico after he held talks with EU Energy Commissioner Dan Jorgensen.

       Kyiv took the controversial step on January 1 to cut off gas revenue helping to fund Russia's war on Ukraine, having given time for alternative suppliers to be found, and supplies have been maintained in the EU.

       But Mr Fico said it will cost Slovakia one billion euros a year in higher prices for the gas it uses and 500 million euros in onward transit fees.

       And he threatened to cut emergency electricity supplies to Ukraine as Russia attacks its power grid, or reduce aid for Ukrainian refugees.

       He said his government could also halt humanitarian aid or use its veto right EU decisions on Ukraine, while insisting that he did not want to raise tensions.

       "There is nothing - not international law or sanctions - that prevents the transit of gas through Ukraine," he told reporters in Brussels.

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       He added that higher energy prices would hit EU competitiveness.

       "If the damage to the EU is permanent, as well as damage to Slovakia, Slovakia will take reciprocal measures," Mr Fico said.

       Slovakia and the European Commission said they had agreed to set up a working group on the issue. The Kyiv energy ministry did not immediately respond to requests for comment.

       But Mr Fico has shifted Slovakia's foreign policy since taking power in 2023 by cultivating relations with Russia and refusing to provide military aid to Ukraine.

       It was not clear how he had reached his assessment of Slovakia's potential losses.

       The 51per cent state-owned Slovak gas transmission operator Eustream reported revenue for all gas transit of 226 million euros for the year ending July 2023, the latest available - a figure that includes a small share of non-Russian gas.

       Slovakia had proposed technical solutions including taking ownership of the Russian gas before it reached Ukraine, but Kyiv rejected them at an EU summit in December.

       Days later, Nr Fico met Russian President Vladimir Putin in Moscow to discuss the issue.

       Slovakia, which has a contract with Russia's Gazprom, needs 4-5 billion cubic metres (bcm) of gas a year to meet its needs, and had been taking around 3 bcm from Russia through Ukraine.

       SPP, the state gas firm, is now buying liquefied natural gas from giants BP, ExxonMobil, Shell, Eni and RWE.