WASHINGTON, July 31 (UPI) -- Eurocrats perturbed by Gazprom's growing dominance of Europe's natural gas market and its hardball capitalist tactics, take heart -- several days ago Gazprom's mighty CEO Alexei Miller was humbled by Turkmen President Gurbanguly Berdimuhamedov. In tough negotiations Berdimuhamedov forced Miller to agree to pay "market rates" for future long-term deliveries of Turkmen gas, according to a brief Gazprom news release.

Only seven months ago Gazprom was paying Turkmenistan $130 per 1,000 cubic meters. Miller subsequently stated that deliveries to Eastern and Central Europe could rise as high as $400 to $500 per tcm by the end of the year. Only seven months ago Gazprom was paying Turkmenistan $130 per tcm.

How was Berdimuhamedov able to pull off his capitalist coup? The answer is simple: competition, most notably by waving competing Chinese and American interests in Miller's face. While the United States has been marginalized in Turkmenistan for a number of reasons, China has not. Since the 1991 implosion of communism, Berdimuhamedov's predecessor, "President for life" Saparmurat "Turkmenbashi" Niyazov, chafed as Gazprom paid a fraction of world market prices for Turkmen gas. Niyazov was stymied in that the former Soviet pipeline network monopoly was his sole access to the global market. When Niyazov died in December 2006, Berdimuhamedov was immediately courted by flocks of foreign energy companies eager to exploit the Caspian's last great frontier, and he decided to play some hardball with Gazprom himself.

The prize is not insubstantial: Turkmenistan's government estimates its onshore hydrocarbon reserves to be 21 billion tons of oil and an astounding 25 trillion cubic meters of natural gas; its Caspian offshore reserves are estimated to be 12 billion tons of oil and 5 trillion cubic meters of gas.

Niyazov left Berdimuhamedov an ace, as Russian heavy-handedness caused Niyazov to consider other options for gas exports. In April 2006, Niyazov signed a deal with China for natural gas exports and the building by 2009 of a Turkmenistan-China pipeline capable of carrying 30 billion cubic meters of gas annually. The pipeline is now under construction, giving Turkmen gas exports a potential new alternative to Gazprom.