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Gazprom Lowers Price To EU, Turkey

Aleksandr Medvedev of Gazprom says prices for EU,Turkey were reduced.
Aleksandr Medvedev of Gazprom says prices for EU,Turkey were reduced.
Russian gas giant Gazprom has lowered the price of natural gas for long-term contracts to its customers in the European Union and Turkey.

The "Financial Times" reported on February 17 that Gazprom cut the price by some 10 percent "under mounting pressure to move away from oil-linked prices."

Gazprom Deputy Chairman Aleksandr Medvedev said, "Our partners asked us to revise our prices and…what we did is correct the parameters of our formula, which lead to the relative price reduction of 10 percent on the average."

Medvedev added that "the new price will ensure Russian gas remains competitive."

The "Financial Times" reported the concession came in negotiations with French company GDF Suez, Germany's Wingas, Slovakia's SPP gas company, and Turkey's Botas.

Complaints by some EU countries that Gazprom was charging too high a price have been strengthened recently by the success in the United States of shale-gas production.

The United States canceled plans to import liquefied natural gas from Russia after it became clear domestically produced shale gas could fill U.S. needs.

Russia reoriented that gas intended for the United States to markets in Europe but Poland, for example, is going ahead with exploration for shale gas and Ukraine has already produced small amounts in its initial stage of development.

Gazprom continues to cast doubts on the viability of shale gas, with Gazprom chief Aleksei Miller saying in his blog on the Gazprom website earlier this month, "the so-called shale-gas revolution is one and the same thing as American Hollywood."

Compiled from agency reports