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Oil Plunges On Fears Of Weak Demand

Oil Plunges On Fears Of Weak Demand

Oil prices fell another 4%…

Gazprom To Hike Gas Prices For European Markets

Natural Gas

Gazprom will increase the price it charges for its natural gas in the European Union this year, to US$180-190 per 1,000 cubic meters, Deputy Chairman Alexander Medvedev told media at an event in Singapore, adding that Europe remains a priority market for the company. To compare, last year’s average price of Gazprom’s gas for Europe was US$167 per 1,000 cu m, the lowest in 12 years.

Gazprom’s market share in Europe rose from 31 percent to 34 percent two years ago, and it is not about to change much in the coming years, Medvedev also said. In fact, he predicted that Gazprom’s share will rise further to 35 percent. That’s despite efforts on the part of the EU authorities to diversify the sources of natural gas that supply the continent with the commodity.

The Russian giant’s efforts to keep its foothold in Europe are currently focused on Nord Stream 2 – an expansion of the existing pipeline that pumps gas to Germany via the Baltic Sea.

The project was stopped by Polish authorities, and there has been vocal opposition from the European Commission and Ukraine, which will see its gas transit income drop if Nord Stream 2 becomes reality, but Gazprom seems determined to go ahead despite it, supported by its European partners, which include Shell, Engie, OMV, and Wintershall.

Related: Cooking The Books? Saudi Aramco Could Be Overvalued By 500%

In fact, Medvedev also said at the event that Nord Stream 2 could only be stopped for political reasons, since it meets all EU technological standards. Nord Stream is designed to pump 55 billion cu m of natural gas to Germany annually.

What’s more, Gazprom is also considering using an alternative pipeline project, TAP, to increase its supplies for Europe. The Trans-Adriatic Pipeline was specifically planned to diversify the EU’s sources of gas by tapping Azeri gas. Alexander Medvedev said earlier this year, however, that Gazprom could use the pipeline under an auction system, which offers open access to any gas supplier.

By Irina Slav for Oilprice.com

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