9 Feb 2020 16:14

Minsk to continue seeking reduction of price of Russian gas

MINSK. Feb 9 (Interfax) - Belarus will continue seeking a reduction of the price of Russian gas, the republics' First Deputy Prime Minister Dmitry Krutoi said.

"In the talks with Gazprom we will, of course, seek a small adjustment in our favor, but, as a baseline variant the price of $127 has in actual fact been registered at the level of the presidents," Krutoi was quoted by the state agency BelTA as saying.

The relevant ministries and Gazprom will continue the talks in the coming weeks, he said. "Some adjustment is possible. But generally, I think agreements have been reached here. The parties are ready for further constructive communication on the basis of the calculations that are available now," he said.

"Bearing in mind the specifics and the tendencies on the global markets, the specific thing about the gas market is that there are long-term contracts with the parties, there are wholesale prices, many contracts are linked to oil quotations, which change, and gas prices correlate with a certain lag of six to nine months - relevant experts will now assess the entire combination of these factors, conditions," Krutoi said.

The first deputy prime minister also said the parties have not negotiated the price of gas for 2021 yet. "A task has now been set to resolve this problem for March-December, bearing in mind that we have only had a gas contract for two months, January and February," he said.

Dmitry Kozak, deputy head of the Kremlin administration, said after the meeting between Belarusian President Alexander Lukashenko and Russian President Vladimir Putin that the parties had agreed to keep the price on gas for Belarus at the 2019 level for this year.

In 2019, Russia supplied to Belarus gas at a price of $127 per 1,000 cubic meters. That price was extended only for the first two months of 2020.

Minsk suggested reducing the gas price from 2020 to the level of the Smolensk region, i.e., practically by one half, as part of the integration processes. However, Russia insisted that it would be wrong to rush the reduction of the gas price for Belarus now that the construction of the union has not been completed.

Lukashenko also said Moscow was not observing the agreements on the gas prices for the republic that were reached when the Belarusian gas transportation system was sold to Gazprom in 2007-2011.

Belarus imports from Russia some 20 billion cubic meters of gas annually.