Ukraine imports gas from EU 1% cheaper than from Russia

Ukraine imports gas from EU 1% cheaper than from Russia



22 січня 2013 года
Конкорд Капитал

Ukraine paid USD 11.9 mln to import 28 mcm of natural gas from Germany and spent USD 1.125 bln to import 2.62 bcm of gas from Russia in November 2012, Interfax reported on Jan. 21, citing Ukrstat data. This implies the average November import price from the EU was USD 425.0/tcm, or just 1.0% cheaper than the price of Russia’s gas at USD 429.4/tcm. In November, the average spot gas price in Germany was 27.35 EUR/MWh, which corresponds to USD 372/tcm, while the price of Russian gas on Germany’s border was USD 419/tcm.



Alexander Paraschiy: The result of the Ukrainian government’s first attempt to diversify external natural gas sources looks rather disappointing. No visible savings have been demonstrated. While the high cost of German gas might be rooted in the small volume in November (Ukraine is reportedly ready to receive up to 5 bcm of gas annually from the EU), it indicates that the German alternative does not look that lucrative to Ukraine. Nevertheless, Ukraine might continue to use the option of importing from the West just to have more leverage in its negotiations with Gazprom, that is, if German spot prices allow for cheaper imports.



So far, it looks like we will see an even higher price of imported gas from Germany in December owing to currency fluctuations. Supply volumes would not have changed dramatically as Ukraine was importing from Germany merely 1 mcm of gas daily, both in November and December 2012. The euro-denominated spot price in Germany was nearly flat mom in December, but due to the euro’s appreciation vs. the dollar last month, Germany’s gas spot was about USD 9/tcm higher than in November.

Источник: Конкорд Капитал

Аналитик: Александр Паращий
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