Russia hopes to keep Ukraine`s gas market

Monday, April 4, 2016 - 13:46 (EEST) Section: Latest news

Russian Energy Minister Alexander Novak says Russia hopes to keep the Ukrainian gas market and resume gas supplies to the country, an UNIAN correspondent reported.
”Ukraine has simply physically reduced gas consumption given the economic downturn, as many companies that bought gas do not operate anymore. Previously, Ukraine consumed 50 billion cubic meters (bcm) of gas, now gas consumption is about 35 bcm. It does not mean that we have lost the market. We are confident that they [in Ukraine] will buy gas, including from Russia. To pass the winter season, they need to accumulate gas stocks in advance,” Novak told reporters.
According to the minister, the situation in the future will depend on Ukraine`s needs as a whole.
”In summer, they do not need to import lots of gas. Let`s see how the situation will evolve in terms of the reserves, the weather is rather cold, and how much gas they would halve to pump [into underground gas storage facilities, UGSF]. Currently, they are taking gas from UGSFs, and later they will do the stocktaking,” he said.
At the same time, Novak noted that Russia considers its pricing policy in respect to Ukraine to be quite flexible.
”Prices have been quite flexible with discounts that we provided. In view of a decline in oil prices, I cannot say that prices are not flexible,” he said.
On March 31, NJSC Naftogaz of Ukraine stated the company would not resume gas purchases from Russia`s Gazprom starting from April 1, 2016, since the gas price offered by Russia for Q2 of 2016 was higher than the price asked by European suppliers.
In addition, it was reported that Gazprom also rejected Naftogaz`s proposal to extend the winter package of agreements, which stipulated the transitional terms of buying Russian gas for Ukraine.
As UaPosition reported earlier, in late November 2015, Ukraine stopped buying Russian gas. According to Ukrainian Prime Minister Arseniy Yatsenyuk, the Russian price was higher than the one asked by European partners.