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22nd Sep 2018

EU energy chief to quiz Russian counterpart on Gazprom

  • European countries are Gazprom's biggest customers (Photo: Joffley)

EU Energy commissioner Gunther Oettinger is set to tackle his Russian counterpart Alexander Novak on Gazprom's energy pricing, EU sources confirmed Friday (31 May).

Oettinger will attend next week's EU-Russia summit in Yekaterinburg, as part of the EU's four person team with Foreigns affairs chief Catherine Ashton, Commission President Barroso and Herman van Rompuy.

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An EU official told this website that Oettinger and Russian Energy minister Alexander Novak would discuss Gazprom's pricing but indicated that the main thrust of their meeting would be on the implementation of the EU-Russia Energy Roadmap.

Signed in March, the Roadmap sets out the basis of co-operation between Russia and the EU in the energy sector.

The summit comes as EU officials attempt to ramp up the pressure on the Russian gas giant, which dominates the eastern European energy market.

Philip Lowe, the European Commission's top energy civil servant, said Thursday (30 May) that Gazprom would not be allowed under EU law to control both the production and supply of gas in Europe, a practice used by the energy giant in several eastern European countries.

"We cannot compromise on this, it is EU law," said a commission source.

Oettinger, told reporters in Vilnius earlier this month that it was "unacceptable" that Gazprom was charging Lithuania 40 percent more than the market price for gas in his native Germany, added that new pipelines were needed to improve gas links with Poland and for more use of Poland's liquefied natural gas terminal.

For his part, Alexander Medvedev, deputy chief executive of Gazprom remarked at a conference on Thursday (30 May) that he "had doubts about the motivation" of the EU executive.

The EU executive opened anti-trust proceedings against the Russian gas-giant in September 2012 over claims that Gazprom's practices in central and eastern Europe were in breach of the bloc's competition rules. Specifically, the ongoing investigation is examining whether Gazprom charges excessively high gas prices and is preventing the diversification of gas supply. If found guilty Gazprom could face a fine of up to 10 percent of its annual turnover.

European countries form Gazprom's biggest market and provide 40 percent of the energy giant's annual revenues.

Energy policy topped the agenda at last week's EU summit in Brussels. Leaders warned that high energy prices, which see European countries paying more than twice as much for gas as in the US, were hampering the competitiveness of businesses.

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