Ukraine will take Russia to the Stockholm court of arbitration if the two sides fail to resolve their latest energy dispute by mid-October, a top Ukrainian official warned Wednesday.

"If we don't reach an agreement,
Ukraine will go to court," the senior official told reporters on condition of anonymity.

Ukraine has been trying to renegotiate the terms of a controversial 2009 gas deal that it signed with Russia after briefly having its supplies cut off in a Kremlin move that also affected parts of Europe .

The 10-year deal sets a higher prices for
Ukraine than some European Union member states and has been condemned by some members of President Viktor Yanukovych's new government.

Yanukovych had an unproductive meeting with Russian President Dmitry Medvedev in August and later sent his energy minister to
Moscow for more talks.

Russia has said it was willing to lower the price from the $400/1,000 cubic meters Ukraine currently pays if Kiev joined a new Moscow-led customs union and gave up a 50% stake in its state energy company Naftogaz.

Ukraine has flatly rejected the idea and insists it remains interested in E.U. membership within the next 10 years.