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Turkmenistan: Russian-Ukrainian Gas Crisis Tests Ashgabat

Ukrainian President Viktor Yushchenko (left) shares a laugh with Turkmen President Saparmurat Niyazov in Ashgabat in March (AFP) The Russian-Ukrainian gas dispute is testing Turkmenistan's self-declared policy of neutrality. Along with Russia, Turkmenistan is one of Ukraine's two biggest gas suppliers. But now Russia is seeking to pressure Ukraine to pay higher prices and, to make its point, reduced supplies of Russian gas to Ukraine on 1 and 2 January. Russia has now restored gas flow in the pipelines through Ukraine to normal levels after European countries downstream said they were getting less gas than normal. Throughout the crisis, Ukraine has suggested it could turn to Turkmenistan to make up any losses of Russian gas supplies. That puts Turkmenistan in a difficult position as it seeks to balance its relations with two capitals: Moscow and Kyiv.

Prague, 3 January 2006 (RFE/RL) – Will Turkmenistan agree to Ukraine's requests for more energy to replace Russian supplies? Or will it ally with Moscow to maintain Russia's pressure on Kyiv?

So far, Russia and Ukraine have given contradictory statements on the matter, while officials in the Turkmen capital Ashgabat have said nothing publicly.

Ukrainian authorities said they were getting more Turkmen gas yesterday, one day after Russia's Gazprom halted its supplies to Kyiv.

"I repeat once again that Ukraine is using its own gas from underground depositories and Turkmen gas in strict accordance with the signed contract," said Ukrainian Fuel and Energy Minister Ivan Plachkov.

What Is Turkmen Role?

But, at the same time, Russia's state-controlled Gazprom denied any suggestion that Kyiv was successfully turning to Turkmenistan as an alternative supplier.

"Only Russian gas is flowing into Ukraine's gas distribution system today [2 January]," the deputy chairman of Gazprom's board of directors, Aleksandr Medvedev, told a news conference in Moscow. "There is no Turkmen gas coming into the Ukrainian system."

With Turkmenistan itself silent on the issue, analysts were left wondering whose side Ashgabat is actually taking.

RFE/RL regional analyst Roman Kupchinsky said that Russia is in a position to block deliveries of Turkmen gas to Ukraine if it desires. And, he said, Gazprom has already maneuvered into a position to make that possible.

Moscow Moves In

In April 2003, Niyazov signed a 25-year gas deal with Russian President Vladimir Putin under which Russia gained the right to buy most Turkmen gas starting in January 2007. In 2006, under the contract, Russia was to buy 7 billion-10 billion cubic meters of Turkmen gas.

Then on 29 December, Aleksei Miller of Gazprom signed a new contract in Ashgabat to buy 30 billion cubic meters of gas from Turkmenistan in 2006 at $65 per 1,000 cubic meters.

Kupchinsky speculated about possible reasons behind the deals. The first is a de facto "gas embargo" Russia introduced toward Ukraine.

"There are two possibilities: One is that they wanted to buy enough gas to fill the pipeline which they [Russia] control anyway, the Central Asia-Center pipeline in order to prevent gas purchased by Ukraine from entering that pipeline," Kupchinsky said. "And then Gazprom spokesman [Sergei] Kupriyanov said there is no room for Ukrainian gas in the pipeline."

Kupchinsky said the second possible reason is that Gazprom, whose production within Russia is dropping, tries to make up for the deficit of domestic gas.

In either case, Russia's levers over Ukraine strengthened.

Turkmen-Ukrainian Cooperation

But analysts said that despite the strategic position Gazprom has acquired, it is by no means certain that Turkmenistan is ready to see its gas deliveries to Ukraine effectively cut off.

That is because Turkmenistan and Ukraine have enjoyed a good partnership over gas, which, despite frictions over Kyiv's periodic nonpayment, has endured over 15 years.

That relationship has seen Niyazov forgive some portions of Ukrainian gas debts from 1993 and 1999 equal to hundreds of millions of dollars. He has also allowed Ukraine to pay for half its current gas deliveries in goods and services.

After a row of negotiations during 2005, Niyazov said in November that Turkmenistan would sell its gas to all buyers at $60 per 1,000 cubic meters starting from 1 January.

A highpoint in the Turkmen-Ukraine relationship came when Ukrainian President Viktor Yushchenko said in late December that -- under the deal reached with Ashgabat -- Turkmenistan would supply Ukraine with 40 billion cubic meters of gas at $50 per 1,000 cubic meters. He said deliveries would start in January.

Moving Targets

Since then, things have only gotten more complicated in the three-way chess game between Russia, Ukraine and Turkmenistan after Ashgabat last week said Kyiv had agreed to buy 40 billion cubic meters of gas for slightly less than $65 per 1,000 cubic meters starting on 1 January.

That could suggest a direct price bidding war between Moscow and Kyiv and mean that all sides must weigh their various economic and political interests carefully in the current Russia-Ukraine gas crisis.

While they do, predicting Turkmenistan's final position becomes only harder day by day.

Central Asia In Focus

Central Asia In Focus

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