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Bulgaria Rejects Gazprom Price Hike

Gas to Turkey, Greece, and Macedonia is piped via Bulgaria (epa) 6 January 2006 (RFE/RL) -- Bulgaria's energy minister has said his country is rejecting an attempt by Russia's state gas monopoly Gazprom to raise the price it charges for its gas.

Energy and Economy Minister Rumen Ovcharov said today the offer is "unacceptable." Gazprom officials were not available for comment as today is a public holiday in Russia.

Bulgaria's domestic consumption is almost totally dependent on Russian gas. The country is also a transit route to its neighbors Turkey, Greece, and Macedonia.

Bulgaria now pays one price for direct deliveries -- according to the energy minister, $257 per 1,000 cubic meters -- and gets cheaper gas in exchange for transit.

Bulgarian officials say Gazprom is pushing Bulgaria to switch to a system under which it pays transit fees in cash and Bulgaria buys all its gas at market prices.

A row over gas prices led Russia to cut off supplies to Ukraine on 1 January. The dispute was resolved with the signing of a new five-year deal three days later.

EU Impact

The issue could affect the EU directly, as Greece, a member state, receives 82 percent of its gas from Russia -- via Bulgaria.

European Commission (EC) spokeswoman Krisztina Nagy said yesterday that it was not clear if the EU could do anything to support Bulgaria, which is scheduled to join the EU next year.

Johannes Laitenberger, chief EC spokesman, said the commission meeting on 11 January will examine the "lessons to be learnt" from the Russian-Ukrainian spat.

However, Laitenberger stressed that the EU executive is currently only empowered to draw up suggestions for a future joint EU energy strategy. All member states, he said, are separately responsible for making their own arrangements.

The EC has been careful over the past week to characterize the Russian-Ukrainian dispute as a "bilateral matter."

An EU diplomat, who requested anonymity, said it was a "fact of life" for the EU that it has to avoid jeopardizing energy supplies from Russia, on which it is heavily dependent.

The diplomat said there was an element of "quid pro quo" about the EU's reluctance to criticize Russia's strong-arm tactics. The official also said the absence of a joint EU energy policy allows Russia to play off member states against one another.

Gas Facts

Gas Facts

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