Wednesday, 21 June 2006

TUKRMENISTAN THREATENS TO CUT GAS EXPORTS

Published in News Digest

By empty (6/21/2006 issue of the CACI Analyst)

Turkmenistan threatened Wednesday to halt natural gas shipments to Russia\'s Gazprom state-controlled natural gas giant if it does not agree to a 30 percent price hike. Turkmen Energy Minister Kurbanmurad Atayev said that the energy-rich Central Asian state intends to increase gas prices from the current $65 per 1,000 cubic meters to $100 starting next month and warned it would cut exports if Gazprom doesn\'t accept the new price. “If within a month and a half we don\'t work out a contract with Gazprom, Turkmenistan will halt the exports,\" Atayev said in a statement released by the government.
Turkmenistan threatened Wednesday to halt natural gas shipments to Russia\'s Gazprom state-controlled natural gas giant if it does not agree to a 30 percent price hike. Turkmen Energy Minister Kurbanmurad Atayev said that the energy-rich Central Asian state intends to increase gas prices from the current $65 per 1,000 cubic meters to $100 starting next month and warned it would cut exports if Gazprom doesn\'t accept the new price. “If within a month and a half we don\'t work out a contract with Gazprom, Turkmenistan will halt the exports,\" Atayev said in a statement released by the government. Turkmenistan is the second-biggest gas producer in the former Soviet Union after Russia, and its vast gas resources are playing an increasingly important role in the geopolitics of the region. Gazprom controls the only transit route for Turkmen gas exports to other ex-Soviet states and Europe. A gas price dispute between Russia and Ukraine resulted in Russian gas supplies being shut off to Ukraine over New Year\'s, leading to shortages in several European countries. Eventually, Russia and Ukraine agreed on a complicated but face-saving scheme whereby Ukraine would buy a blend of Russian and Turkmen gas at double the previous price via an intermediary. Gazprom officials have recently warned that gas price for Ukraine could be increased later this year if Central Asian nations charge more for their gas. The matter of exports to Ukraine \"has to be resolved after Ukraine\'s agreements with the transit countries,\" Atayev said. In 2003, Russia and Turkmenistan signed a 25-year deal for cooperation in the gas sector, and last December the two countries signed a contract for Gazprom to import 30 billion cubic meters of gas in 2006 at a price of $65 per 1,000 cubic meters. On Monday, Gazprom\'s head Alexei Miller visited the Turkmen capital, Ashgabat, to renew the contract, but Turkmenistan \"categorically refused the offer,\" Atayev said. (AP)
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The Central Asia-Caucasus Analyst is a biweekly publication of the Central Asia-Caucasus Institute & Silk Road Studies Program, a Joint Transatlantic Research and Policy Center affiliated with the American Foreign Policy Council, Washington DC., and the Institute for Security and Development Policy, Stockholm. For 15 years, the Analyst has brought cutting edge analysis of the region geared toward a practitioner audience.

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