Thursday, 19 November 2009

Price for gas Ukraine buys from Russia may increase to $270-$300

Natural gas that Ukraine will buy from Russia in the first quarter of 2010 will cost $270-$300 per 1,000 cubic meters compared to $208.1 per 1,000 cubic meters in the fourth quarter of 2009, said Bohdan Sokolovsky, a Ukrainian presidential representative for international energy security. "If we talk about the beginning of the year, January, there are estimates on gas imported from Russia - this is from $270 to $300 per 1,000 cubic meters. I am inclined to think the latter figure is more correct, judging by the trends in the price for the oil basket," Sokolovsky said at a press conference in Kyiv.Talking about the price for gas transit, Sokolovsky suggested it could increase by $0.7-$0.8 for transporting 1,000 cubic meters of gas per 100 kilometers, which means that the 2009 transit tariffs will increase by 41%-47% from $1.7."In line with the formula stipulated in the transit contract, the price should increase by about 70-80 cents. This is certainly a bit too little," he said.It was reported earlier that, since the signing of a gas deal between Gazprom and Naftogaz of Ukraine in January 2009, the price for Russian gas bought by Ukraine has been calculated by a formula, in which the gas price directly depends on the world oil prices. Considering that Ukraine was granted a 20% discount in 2009, the gas price in 2010 can grow by 25% even if all the other factors remain the same.The price for Russian gas bought by Ukraine in the first quarter of 2009 was $360 per 1,000 cubic meters, in the second quarter it declined to $270.95 and in the third to $198.34 and then rose to $208.12 in the fourth quarter.We remind that Ukrainian President Victor Yushchenko on Nov. 19 urged Russian President Dmitry Medvedev in an open letter to change an agreement on supplies of Russian natural gas.

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