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Bulgaria's energy budget woes

Sept. 25, 2009 at 5:10 PM   |   Comments

SOFIA, Bulgaria, Sept. 25 (UPI) -- Rising energy costs have entered Bulgaria's government budget debates.

Bulgarian 24 Chassa news agency reported Friday that on Oct. 1 the wholesale price of natural gas will rise 2.49 percent to $280 per thousand cubic meters before VAT.

According to the State Energy and Water Regulatory Agency, the increase is due to the rising costs of oil and petroleum products, on which the price of Bulgaria's imports of Russian natural gas is based. However, the slight price increase is only temporary, as the state-owned Bulgargaz natural gas consortium forecasts that from Jan. 1 the cost of natural gas imports from Russia will surge by 20 percent or even more, substantially adding to the country's foreign debt.

Rising energy costs and economic decline have led the National Assembly to discuss restructuring the country's 2002 external debt swap arrangement, with Blue Coalition MP Dimo Gyaourov warning that "the debt deal may cost us a loss of $3 billion."

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