Russia 'Ready to Compete on Price for Turkey': Minister
Russia and Turkey October 10 resumed talks on the price Botas pays for its gas imports, Russia’s energy minister Alexander Novak has said, with Gazprom prepared to cut prices to retain market share. In an interview with Turkish paper Hurriyet, he also said Russia was ready to compete for the Turkish market with any other gas suppliers, including Israel.
“The question of discounts you are talking about was considered at the beginning of 2015. The talks about the price of gas have resumed and I hope the parties come to a common position,” he told the October 8 edition of Hurriyet.
In early August, after the joint press conference of the presidents of Russia and Turkey, Vladimir Putin and Recep Tayyip Erdogan, Novak said the issue of discounts for Russian gas for Turkey was not on the agenda.
Route of Turkish Stream gas line
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(Credit: Gazprom)
“The situation is completely different compared with when this issue was discussed a few years ago. First, the price has dropped significantly. Today, according to the price formula, the contract prices are competitive, enough corresponding to the market. Therefore this issue is not on the agenda,” Novak said then. Turkey has since made overtures to Israel, whose Leviathan gas field needs purchasers.
According to the latest official statistics, Turkey imported 14.348bn m3 of Russian gas in the first seven months of this year, about 853mn m3 less than the same period in 2015.
The two sides will also discuss Turkish Stream, the planned pipeline under the Black Sea, with four strands each of 15.76bn m³/yr. Demand at present does not justify more than one, and even one may be too many.
Gazprom's North Stream 2 poses a challenge for the expansion of Turkish Stream beyond the first branch. Market experts have repeatedly said that North Stream 2 and Turkish Stream may be mutually exclusive owing to their redundancy. European gas demand has yet to show the bullish long-term signals needed to justify the new capacity.
Azerbaijan desk