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Gazprom rejects Belarus’ request for gas price cut

 
Gazprom finds it “inexpedient” to reduce the price of natural gas supplied to Belarus, Valery Golubev, deputy chairman of the Russian state-owned gas giant, said on April 9.

“We have a very simple price formula for Belarus,” Russian news agency RIA Novosti quoted him as saying. “We add the cost of transportation to the cost of [gas] extraction in the Yamalo-Nenets region, nothing extra is added. And this principle was declared in an agreement. Why should we sell gas to Belarus at a lower price than in Russia?”

Belarus once rejected a proposal that the price of natural gas for it be tied to the price of crude oil, according to the executive. “They wanted the price that is charged in Russia plus the cost of transportation,” he said. “Today Belarusian colleagues say that they want a different formula. Well, they need to be consistent.”

Belarus currently pays $132 for 1,000 cubic meters of gas supplied by Gazprom, said Mr. Golubev.

He said that Kyrgyzstan and Armenia bought Russian gas at a price of $150 per 1,000 cubic meters. “Can they also demand a price cut? And who will offset our costs?” said the executive.

Minsk has pushed for a gas price cut, insisting that the price needed to be lowered because of the depreciation of the Russian ruble.

There are reasons to expect that Russia will reduce its natural gas price for Belarus for 2016, Deputy Prime Minister Uladzimir Syamashka told reporters in Minsk in December 2015.

“We believe there is every reason to say that the price of gas will be considerably lower from January 1, although it is acceptable even now,” Mr. Syamashka said. “To be precise, it is $142.37 per 1,000 cubic meters.”

In December 2015, Deputy Energy Minister Vadzim Zakrewski expressed hope that Russia’s natural gas price per 1,000 cubic meters for Belarus would be more than $10 lower in 2016.