Price of Russian gas for Ukraine could climb to $500/1,000 cubic meters in April - PM
The price of Russian gas for Ukraine could increase to $500 per 1,000 cubic meters as of April 1, Ukrainian Prime Minister Arseniy Yatseniuk said.
"As of April 1, Russia […] wants to raise the price of gas for Ukraine essentially two-fold. We're talking about a price of about $500 per 1,000 cubic meters," Yatseniuk said on TV channel 1+1 at the end of last week.
Ukraine cannot refuse to buy gas from Russia at such a price "because in the past few years nothing has been done in terms of diversifying supplies of energy resources," he said.
"We're left with the fact that we'll still have to buy a significant share of gas from Russia at $500 per 1,000 cubic meters," Yatseniuk said, remarking that Russia "is deliberately raising the price of gas two-fold without any grounds, primarily in order to raise the price for households."
"We need to prepare for an increase in the price of energy resources. I'm now working out a plan for how we are going to do this […]. We are thinking about how to not raise prices for low-income households," Yatseniuk said.
Returning to the issue of diversifying energy supplies, he mentioned reversing the flow of gas from European Union countries. "But in order to ensure this reverse, a decision is needed from one country - an EU member that is, very unfortunately, also quite dependent on Russia, and Russia is also putting pressure on EU member countries. If we manage after all to make the reverse happen, the price for that European gas will be $100-$150 cheaper than the price of Russian gas. Russia knows this and will therefore continue to exert pressure. Therefore, the government has plans […] to increase domestic production. If we invest more in our own production, we can increase volumes by 30%," Yatseniuk said.
He also announced plans "to increase electricity in the energy mix," and mentioned the possibility of producing shale gas "while maintaining all environmental standards."
"Can this be done in a day? No. Does this already need to be done now? Yes, this should have been done the day before yesterday already," Yatseniuk said.
However, Energy and Coal Industry Minister Yuriy Prodan told reporters earlier that the price of Russian gas for Ukraine would be $386-$387 per 1,000 cubic meters in the second quarter on the condition that the so-called Kharkiv agreements are in force. A Ukrainian delegation is now preparing for negotiations with Russia to sign appendixes to the current gas agreement, he said.
Prodan said last week that Ukraine is continuing to pay down its gas debt to Russia. "Our payment for February amounted to about $90 million; $350 million remains to be paid, while the whole debt for 2013 amounts to $1.5 billion," he said.
Prodan said Ukraine plans to completely settle up with Russia on gas debts following the implementation of a reform plan that is now being negotiated with the International Monetary Fund.
