Ukrzaliznytsia buys gas for its enterprises directly from suppliers for first time, saves over 25%

MOSCOW. Jan 30 (Interfax) - Energo Sales Trans, a corporate trader of JSC Ukrzaliznytsia (Ukrainian Railways), in January made its first purchases of natural gas for the needs of Ukrzaliznytsia's production enterprises directly from suppliers, avoiding intermediaries, a move that helped reduce the price to 18,600 hryvni per 1,000 cubic meters of gas, Ukrainian media outlets said, citing information circulated by the Ukraine's Recovery Ministry on social media on Saturday.

"The price of gas ended up 25% lower than the prices at which enterprises of JSC Ukrzaliznytsia bought natural gas via private suppliers at the end of last year. The new price was 18,600 hryvni per 1,000 cubic meters," Deputy Prime Minister and Recover Minister Alexander Kubrakov was quoted as saying by the report.

The next step will be direct purchases of natural gas from producers to cover the needs of Ukrzaliznytsia itself, Kubrakov said.

In 2021, Ukrzaliznytsia was permitted to buy electricity from Energoatom and other state-owned power generating companies for a period of up to three years using a special simplified procedure, the minister said. Furthermore, in 2022, the government allowed Ukrzaliznytsia to directly purchase petroleum products under foreign trade contracts.

The weighted average price of natural gas on the Ukrainian Energy Exchange on January 28 was 19,950 hryvni per 1,000 cubic meters