A new gas deal approaches
2012 was welcomed with intense gas negotiations going on between Ukraine and Russia. The current state of play appears to be heading toward a considerable decrease of the Russian gas price in exchange for control of a chunk of Ukraine’s energy assets including the gas pipeline network and gas reserves. Both teams of negotiators have brought rather powerful arguments to the table.
President Viktor Yanukovych, Prime Minister Mykola Azarov and Energy Minister Yuriy Boiko underline that — even with a discount — the current gas price: $416 per 1,000 cubic meters in the first quarter of the year is unreasonably high. Ukraine can also search for alternative lower cost energy sources, increase the development of domestic gas to 22 billion cubic meters per year and thereby minimize consumption of Russian gas in 2012 down to 27 billion cubic meters.