BELARUS NEWS AND ANALYSIS

DATE:

30/05/2006

Gazprom wants to quadruple prices for Belarus: paper

MOSCOW (Reuters) - Russia's Gazprom (GAZPq.L: Quote, Profile, Research) wants to quadruple gas prices for neighbouring Belarus from 2007 instead of tripling them after failing to win control over the country's pipelines, a newspaper reported on Tuesday.

Kommersant business daily quoted Gazprom sources as saying the gas monopoly wanted Belarus to raise payment to around $200 per 1,000 cubic metres from around $47 now and above a $150 price it had initially asked the country to pay from next year.

Sources told Kommersant that the demand for a higher gas price was made after Belarus declined to cede control of its pipelines to Russia, a move Gazprom has demanded for years in exchange for low gas prices for the ex-Soviet republic.

Gazprom declined to comment on the report.

The company had a similar gas pricing dispute with Belarus in 2004, which briefly led to a cut in gas supplies to the country and reduced flows to Poland and Germany, which get some of their gas from Russia via Belarus' transit pipelines.

But the conflict had much smaller economic and political implications than this year's similar dispute between Gazprom and Ukraine, which resulted in much larger cuts across Europe.

Europe has questioned whether it should continue to rely on Gazprom for a quarter of its gas needs, and U.S. Vice-President Dick Cheney called on Russia earlier this month to stop using its energy resources as a tool to intimidate or blackmail its neighbours.

Source:

http://today.reuters.com/business/newsArticle.aspx?type=ousiv&storyID=2006-05-30T051125Z_01_L30122566_RTRIDST_0_BUSINESSPRO-ENERGY-GAZPROM-BELARUS-DC.XML