Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Let's not pretend as though Gazprom gives a damn about market prices.  Energy markets are nowhere near perfectly competitive, and, despite all the complaining about Ukraine not paying the "market price," Gazprom turned in a 10% profit (over $6 billion) this year.

And a $1.5 billion difference, which an above comment (written by you, I believe) argued the Ukrainians should just pay, may not sound like a lot of money, if you live in the US, Western Europe or Russia, but, when your GDP is only about $300 billion, it's a lot of money.  It's easy to advocate coughing up the money when your country has it or can easily afford to borrow it.

The entire issue seems to be more political than economic.  Former Soviet Republics who have agreed to play nice with Moscow are getting gas for less than half the price being demanded from Ukraine -- even less than the former rate in Ukraine for Belarus.  You're seriously arguing that this has nothing to do with politics?

Be nice to America. Or we'll bring democracy to your country.

by Drew J Jones (pedobear@pennstatefootball.com) on Mon Jan 2nd, 2006 at 02:37:02 PM EST
[ Parent ]
I'm saying that Gazprom as a private company is interested in more profit.

The fact that Ukraine is poor (real or perceived) does not mean it can steal whatever gas it wants.

Russia's government already offered a loan, which was rejected. Gazprom also offered lower gas prices for the share in gas pipelines and Ukraine was not interested. So the problem is not with money.

Belarus never had problems with theft, and Gazprom has a share in pipeline. From Gazprom point of view, low gas prices is a payment for the pipeline ownership.

by blackhawk on Mon Jan 2nd, 2006 at 08:36:38 PM EST
[ Parent ]


Occasional Series