Russia's natural gas monopoly Gazprom and its Ukrainian counterpart Naftogaz have reached an agreement to settle the gas debt crisis.

Gazprom and Naftogaz have reached an agreement that Naftogaz Ukraine will pay in full for the gas delivered during the period between January 1st and March 1st 2008, according to the agreement made in the beginning of the year.

Gazprom spokeman said in a joint statement with Naftogaz. It will resume gas supply to Ukraine that was cut by half on Tuesday.

Transit of Russian gas across Ukraine to Europe continues in full.

The agreement came after telephone negotiations involving Russian President Vladimir Putin, Ukrainian President Viktor Yushchenko and the heads of the two companies.