No natural gas war in Europe, analyst says

Jan. 28, 2013 at 7:33 AM
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MOSCOW, Jan. 28 (UPI) -- Despite Gazprom sending a $7 billion bill to Ukraine for 2012 gas volumes, an energy analyst in Moscow ruled out another round of crippling disputes.

Gazprom in 2006 and 2009 cut natural gas supplies through Ukraine in response to contractual disputes. Those rows left downstream European consumers in the cold as most of the Russian gas bound for their region runs through Ukraine's transit system.

Gazprom sent state energy company Naftogaz a $7 billion bill for not living up to the terms of its gas agreements last year.

Lev Snykov, a partner at Greenwich Capital in Moscow, however, told Bloomberg News he didn't "think there will be a third gas war."

Former Ukrainian Prime Minister Yulia Tymoshenko is serving a seven-year prison sentence after being convicted on charges she abused her authority when she helped break the 2009 impasse. Ukrainian Prime Minister Mykola Azarov said the deal was "enslaving."

Bloomberg states that Ukraine paid $430 per 1,000 cubic meters of natural gas in December under the terms of a take-or-pay deal with Gazprom. That's $30 more than Gazprom charges other European customers.

Ukraine last year imported 32.9 billion cubic meters of natural gas. The country has looked to foreign companies interested in its shale natural gas reserves as a way to break the Russian grip on its energy sector.

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