Vladimir Putin
Russia's President Vladimir Putin chairs a meeting at the Novo-Ogaryovo state residence outside Moscow Reuters

Russia's President Vladimir Putin has accused Ukraine of sabotaging gas talks after Kiev rejected Gazprom's offer of a $100 reduction in the price it pays for natural gas.

Putin said Kiev's negotiating team had forced the talks into to a "dead end" after the two sides failed to reach a compromise.

The Brussels meeting ended with Ukraine demanding a change in the terms of its contract with Russia's state energy giant Gazprom, while Moscow suggested that it had made its final offer to Kiev.

"The reduction is too little for our Ukrainian partners; they want more, although it's not clear on what basis," Putin said. "If this is the case, then it seems that the issue is being driven into a dead end."

The current deal locks Ukraine into buying a set amount of gas from Russia, regardless of the quantity it consumes. The contract sees Kiev paying $485 per 1,000 cubic metres, the highest price of any European customer.

The ongoing gas dispute between the two neighbours has twice seen Moscow cut off supplies to Kiev in 2006 and 2009, affecting deliveries to the broader European market.

Moreover, the stand-off over gas is at the centre of a broader political battle between the two countries, as Ukraine's newly-elected pro-Western president seeks to head off a pro-Russian insurgency in the east of the country.

The crisis erupted when Ukraine's former president Viktor Yanukovych fled the country after months of street protests, spurring Moscow to annex the Crimea region and nearly double the price it charges Ukraine for natural gas.

The former president had previously arranged a favourable rate cut in return for strengthening economic ties with Moscow.

Talks are set to continue ahead of negotiation deadlines as the two sides seek to stave off a crisis.