Kiev, Ukraine ? Ukraine agreed on Wednesday to nearly double the amount it is paying for natural gas while Russia agreed to pay $2.4 billion a year more to transport fuel through its neighbor to other European nations. The deal ended a stalemate that threatened the continent’s winter energy supplies and shook confidence in the world’s biggest gas supplier.

Negotiating into the predawn hours to avoid being summoned to Brussels, Belgium, to end their pricing dispute, officials from Ukraine and Russia emerged with a compromise that allows both sides to claim victory and assures an agreement on the transit of more than a quarter of Europe’s gas for the next five years.

The higher prices will cost Ukraine about $2.9 billion a year, which opposition leaders said would gut-punch the aging, gas-guzzling steel and chemical plants that keep the economy afloat. However, most analysts said the country could absorb the shock if it moves seriously to impose energy conservation measures.

In Russia, which will be getting the full $230 per thousand cubic meters it was demanding from Ukraine – while cheaper Central Asian gas blended into the deal eases Ukraine’s overall costs – there also was a mood of optimism.

The agreement ends for the moment the crisis that began Sunday morning when Russia cut off Ukraine’s share of the gas that flows along Ukrainian pipelines to Europe. Supplies to central and parts of western Europe plunged by a third or more, apparently because Ukraine continued to remove gas from the pipeline it believed it was owed under a separate contract with Turkmenistan.

Moscow accused Ukraine of stealing the gas, and the conflict descended into three days of mutual accusations, even after Russia restored most of the gas flows under heavy criticism from Europe.