Reading the piece that Leanan has in Drumbeat about the continuing cost increases for natural gas in Ukraine, following the agreement last year with Russia on sustained deliveries, I was struck with the contrast to an earlier item on anticipated costs for natural gas in the UK. In the Ukraine costs are going to be going up another 40%, while in the latter the wholesale price of gas in the UK has dropped by more than 50% since June, and this is projected to extend into the future. With that thought in mind, and given that part of the supply for the UK will likely increasingly come from Russia, I thought I would have another little look at what is going on with Gazprom.

In the Ukraine the agreement last year almost doubled the natural gas price (raising it to $95 per thousand cubic meters (tcm) . Belarus just signed a deal that will cost them $100 per tcm, while Georgia is now paying $235 per tcm . The price that Belarus pays, however, is given as $70 in cash and $30 in shares of the Belarus pipeline company Beltrangaz. Over the next four years the price will rise to the European price (currently the one that Georgia is paying) and by that time Gazprom will own half of the company.