Gas prices have plunged as the European Union and Russia have agreed to cut gas prices in a deal to reduce tensions over Ukraine.

Gas stations in the country are now selling for about two euros ($2.25) per 1,000 cubic metres (mcf), down from a peak of almost three euros a 1,002 mcf a year ago.

EU Energy Commissioner Joaquín Almunia told a news conference on Tuesday that prices will be lowered in the next few days to reflect the price of gas in the region.

Russia and the EU signed a deal in January for gas to be supplied from their own gas pipelines.

They are now trying to reduce costs by importing gas from Russia, which has a large and growing gas sector.

Almunia said the deal should “prevent the current crisis” and prevent “unnecessary tensions”.EU energy ministers are due to discuss the deal on Tuesday and the price could fall, Almuni said.

The EU and Russia agreed in January to lower gas prices to protect Russia’s gas industry and the bloc’s energy security.

European Commission President Jean-Claude Juncker said the gas deal is a “historic moment” in energy markets.

However, he said it is not enough.

“This deal will not end the gas crisis, but will certainly reduce the cost of gas for European consumers,” he said.

“But we cannot ignore that price reduction does not guarantee a reduction in price.”

The EU-Russia gas pipeline was built by a consortium led by French energy group Total and Gazprom.

It carries gas from Siberia and Russia’s Far East to the EU.

Russia and Germany have agreed not to cut their gas prices, and have agreed on a three-year deal with each other to boost gas supplies from Russia.EU ministers will hold a summit on Tuesday to discuss whether they can find a solution to the crisis in Ukraine.