Gazprom claims ready to supply gas to Ukraine after USD 1.5 bln payment

Russian natural gas monopoly Gazprom is ready to restart gas supplies to Ukraine if its monopoly Naftogaz repays USD 1.45 bln in debt for gas imported in 2013 and agrees on repaying other debt, CEO Alexey Miller told journalists on Aug. 29, as reported by the Interfax news agency. Russian Economy Minister Alexander Novak reported the same day that Russia is ready to provide gas to Ukraine at an interim price of USD 385-386 per tcm (in April, Russia demanded that Ukraine pay USD 485/tcm). After a meeting with Novak, EU Energy Commissioner Gunther Oettinger stated that the EU Commission will offer a repayment schedule for Ukraine in the nearest future. During the meeting in Moscow, the two sides also agreed to start new gas negotiations with the Ukrainian side, with the date of such negotiations to be approved in the first week of September.



On June 16, Gazprom stopped supplying of its gas to Ukraine after Naftogaz declined to pay a USD 1.95 bln bill to the Russian monopoly. The total amount of unpaid gas that Ukraine imported from Russia is 11.5 bcm, including 3.6 bcm (worth USD 1.45 bln) imported in 4Q13 and 7.9 bcm imported in 2Q14. Based on the gas price offered by Gazprom, the debt for gas that Ukraine imported in 2Q14 is USD 3.05 bln (earlier Russia wanted to charge USD 3.85 bln for this same volume of gas).



Alexander Paraschiy: As the heating season in both Ukraine and the EU is approaching, the EU energy commissioner looks increasingly concerned about the stability of future supplies of Russian gas to EU countries (through Ukraine) and he appears ready to offer (and persuade Ukraine to offer) many concessions to Gazprom. Thus far, Gazprom seems to be also ready for concessions, decreasing by USD 0.5 bln its demanded money that Ukraine has to prepay to restart gas imports.



Yet Ukraine doesn’t seem ready to agree on such “relaxed” conditions. We expect Naftogaz will: a) continue to insist on a price for Russian gas at USD 268.5/tcm and/or b) insist that EU-based gas traders buy Russian gas at the Russia/Ukraine border instead of the Ukraine/EU border. Although it will be not easy for Ukraine to survive this winter without Russian gas (Ukraine will have to cut gas consumption by about 25% from the prior season to get through this winter), Ukraine’s current negotiating position doesn’t look so bad considering the government is capable of making such cuts and any concessions to the aggressor-state Russia will not be welcomed by the public. Finally, Ukraine always has the option of “accessing” Russian gas that passes through its territory to EU countries any time it face a real need for it. In which case, it will more of a problem for the EU and Russia than Ukraine.

Источник: Конкорд Капитал