Wednesday, March 12, 2008

No more cheap gas

This small but maybe highly significant snippet from today's 'Donbass' newspaper:

Asia raises price of gas

Yesterday a meeting took place in Moscow between Gazprom CEO Aleksei Miller, the President of "KazMunayGaz", Uzakbay Karabalin, CEO of "UzbekNeftegaz", Nurmukhammad Akhmedov, and chairman of "Turkmengaz", Yagshigel'dy Kakayev.

During the meeting the leaders of the gas companies of Kazakhstan, Uzbekistan and Turkmenistan declared that: "on the basis of the interests of [our] national economies, and taking into account international obligations regarding the guarantee of reliable and uninterrupted deliveries of fuel, from 2009 the sale of natural gas will be realized at European prices".

Bad news for Ukraine who imports most of its gas from central Asia. Looks like soon they are going to have to pay 'top whack'*.

*The maximum price or rate. {Informal - British}


Anonymous said...

Looks like Ukraine is gonna have to start becoming efficient -- and do it quickly. According to BP stats, Ukraine consumed 66.4 bcm of gas in 2006, while Germany consumed 87.2 bcm. Germany consumed 31% more, but its economy is $2.3 _trillion_ while Ukraine guzzles gas in its $364 billion economy.

Russia, Turkmenistan, Kazakhstan and Uzbekistan are raising prices while their domestic consumption remains subsidized. Who will pay for these subsidies -- Ukrainians! The EU countries at least get their money's worth.

Will this fact be enough to convince Ukrainians to install new windows? Or to upgrade gas-fired plants to western standards? Nope. Yushchenko will continue to push for cheap gas -- a thing of the Soviet era. If he wants cheap gas, it is easy: sell Ukraine's GTS to Gazprom. But that won't guarantee low prices (look at Belarus).

Anonymous said...

Prime Minister of Ukraine Yulia Tymoshenko assured that her government will hold gas price at USD 179.5 in 2008. She said that today at the briefing, the ForUm’s correspondent informs.

“There are no reasons to concern that gas price will be increased, but next years we should hold a stage of negotiation processes,” Tymoshenko said.

Anonymous said...

President of Ukraine Victor Yushchenko claims that Ukraine must get ready to a new gas price.

According to an UNIAN correspondent, he claimed this to a press conference in the Cherkassy Oblast today.

“The big problem is connected with adapting to a new gas price, and we must get ready to such things – either in a form of the national reserve, or in the form of creating self-sufficient budget relations”, he said.