Ukrainian President Viktor Yushchenko said Friday that his country should produce its own nuclear fuel for power plants, part of the West-leaning leader's effort to reduce its reliance on Russia following a dispute over natural gas prices.

"We must change our uranium policy — our policy on the use of uranium for peaceful purposes," Yushchenko said on national television. "We must cooperate with international allies on a serious political and economic level so that we can have a full cycle of processing and production of nuclear fuel."

Yushchenko's call could put his Western allies in an awkward position as they seek to balance the desire to help Ukraine shed Russian influence with concerns about nuclear weapons proliferation and their campaign to contain Iran's nuclear ambitions.

The announcement came after Moscow and Kiev ended a public fight over natural gas with a deal last week that nearly doubled the price of gas for Ukraine and drew protests from Yushchenko's opponents ahead of March parliamentary elections.

The compromise was reached only after Russia briefly cut off gas supplies to Ukraine, whose pipelines pump most of the gas Russia exports to Europe.

Ukraine is the site of the world's worst nuclear accident, the 1986 explosion and fire at a reactor at the Chernobyl plant, which has been shut for good. Nearly two decades later, the nation of 47 million relies on four operating nuclear power plants for about half its electricity production — and it depends on Russia for fuel that feeds them.

Ukraine supplies Russia with raw uranium, then buys it back after enrichment; a full nuclear cycle means that Ukraine would be enriching uranium by itself. Uranium enrichment is a possible pathway to the development of nuclear arms, but Yushchenko insisted his country — a member of the International Atomic Energy Agency, the U.N. nuclear watchdog — had only peaceful intentions.

Yushchenko's announcement came amid a mounting international standoff over Iran's refusal to give up uranium enrichment, and against the background of calls to halt the spread of enrichment facilities.

IAEA chief Mohamed ElBaradei has proposed a moratorium on the construction of any new enrichment plants, and President Bush has proposed principles that would limit enrichment technology to countries that already carry it out.

Yushchenko's call for a nuclear cycle poses "a dilemma for the Bush administration," said Edwin Lyman, senior staff scientist at the Union of Concerned Scientists, a private nuclear proliferation watchdog group. "This is an ally. They want to support an independent Ukraine that can stand up to Russia ... but it would violate this policy that Bush has proposed."

Ukraine is not barred from enriching uranium under the Nuclear Nonproliferation Treaty or IAEA rules, and the nation that inherited the world's third-largest nuclear arsenal with the 1991 Soviet collapse has proved trustworthy in proliferation matters. It renounced nuclear weapons and transferred some 1,300 nuclear warheads to Russia for disarming.

But while Yushchenko — who beat a Russian-backed candidate in an election struggle just over a year ago — has friendly ties with Europe and the United States, Lyman said the potential for further political turmoil in Ukraine could raise concerns about what future leaders would do with a fuel cycle, warning that enrichment facilities can be retooled for weapons purposes relatively easily.

IAEA officials said they had no comment late Friday.

Yushchenko said providing Ukraine the capability of producing its own nuclear fuel was part of his plan for creating "an independent energy balance" within five years. He also said the nation should diversifying gas supplies and developing its own gas fields.

His call for a fuel cycle could face major financial obstacles in the economically struggling country. At least in part, it may have been meant as a public display of independence and industriousness ahead of the parliamentary elections — and a message to the West that Ukraine needs more support for its effort to cut reliance on Russian energy.