Mixed views on Gazprom

WASHINGTON, Nov. 4 (UPI) -- A report by Russian gas giant Gazprom that European gas purchases were up is more of a reflection of low prices than economic recovery, analysts say.

Gazprom announced recently that European customers purchased 15 percent more gas in October than they did in the previous year when the global recession gripped world markets.

The price of natural gas followed declines in the oil market earlier this year as crude prices collapsed from 2008 highs of more than $140 per barrel.

Gazprom said it views the rise in gas purchases as a sign of economic recovery in the European market, but analysts are not so sure, reports The Wall Street Journal.

"There has been a rise in demand, but it's unclear if it's due to the underlying economic recovery or just the onset of winter," said Louise Boddy, a gas analyst at ICIS Heren.

Despite the debate, energy analysts see Gazprom in a growth period, with its expected production for 2009 down only 10 percent from the previous year.

In October, Gazprom produced 52.9 billion cubic feet of gas per day, up from 42.3 billion cubic feet the previous month.