Category Archives: Oil, Gas, Energy

Russian Gas: There Is No Alternative For Europe

EU Map

(Oilprice.com – Colin Chilcoat – May 17, 2015) The sanctions are now in their second year; the ruble is still not quite itself; and national champions Gazprom and Rosneft are both bracing for what can generously be called a down year. Still, while Russia’s political relationship with the west continues to be redefined, the broader element of codependence remains relatively […]

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A wakeup call for Gazprom

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Widely considered one of Russia’s most potent weapons, Gazprom’s financials show the slow erosion of its core business. (Business New Europe – bne.eu – Mark Adomanis in Philadelphia – May 19, 2015) As with almost every other major Russian company, 2014 was not a particularly good year for Gazprom. In fact, at first glance, the headline numbers were nothing short […]

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Russia Was Right: Shale in Europe Has Proved a Dud

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(Bloomberg – bloomberg.com – Ladka Mortkowitz Bauerova – May 11, 2015) When Cuadrilla Resources Ltd. opened an office in Poland in 2009, it had a reason to be optimistic: the shale boom was transforming the U.S. into the world’s largest producer of natural gas. To the companies rushing to imitate that success in Europe, Poland looked like the next Texas. […]

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Punitive Tax Regime Is Crushing Ukraine’s Oil And Gas Sector

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(Oilprice.com – Robert Bensh – May 6, 2015) Each country blessed with oil and gas discoveries initially tries to create a tax regime that maintains the balance between generating tax revenues from the extraction of these hydrocarbons while also encouraging investment. If the country gets too greedy and imposes an excessive tax burden, the inverse effect occurs – investors abandon […]

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Oil’s Rebound Is Here

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(Bloomberg – bloomberg.com – Leonid Bershidsky – May 6, 2015) As Brent crude oil reached more than $68 per barrel Wednesday, a high for 2015, analysts started to backtrack on earlier predictions of $40-$50 oil. The rebound, however, may not last: Speculators appear to have disrupted Saudi Arabia’s strategic game against U.S. shale oil producers. Predicting oil prices is a […]

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Is Gazprom a “buy”?

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(Business New Europe – bne.eu – MOSCOW BLOG: Ben Aris in Moscow – May 7, 2015) [Chart here http://www.bne.eu/content/story/moscow-blog-gazprom-buy] With the RTS Index up 30% year-to-date, foreign investors are drifting back into Russian shares simply because they are so cheap. But is the bluest of Russian blue chips and long-time market proxy Gazprom a buy again? Russian investment bank Renaissance […]

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Russian Economy May Be Stumbling Back To Its Feet

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(Oilprice.com – Andy Tully – May 3, 2015) The Bank of Russia has cut interest rates for the third time so far this year, reinforcing forecasts by some government ministers that the country’s economic woes are beginning to stabilize. The central bank cut its key rate on April 30 to 12.5 percent, a reduction of 1.5 points, and said it would […]

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Strengthening of ruble due to growth of oil prices over – Yudayeva

Oil Wells File Photo

MOSCOW. April 22 (Interfax) – The strengthening of the ruble due to growth in prices for oil has ended, First Deputy Central Bank Governor Ksenia Yudayeva told journalists at the Forum for Financial Stability on Wednesday. “The strengthening of the ruble has ended, it has partially ended, what we saw was connected with the sharp movement upwards in prices for […]

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Is Gazprom’s changing export strategy a threat to Europe?

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(Business New Europe – bne.eu – James Henderson – April 17, 2015) James Henderson is Senior Research Fellow, Oxford Institute for Energy Studies The visit of Chinese Premier Xi Jinping to Moscow in May to celebrate the 70th anniversary of the end of World War II could also mark the next stage in Russia’s “pivot to Asia” if, as some […]

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Russia Economy Recovering as Oil Reliance Eases, Dvorkovich Says

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(Bloomberg – bloomberg.com – David Tweed, Haslinda Amin – April 20, 2015) Russia’s economy showed signs of recovery in the first and second quarters amid a declining dependence on oil, Russian Deputy Prime Minister Arkady Dvorkovich said. “Oil prices are not as important to the Russian economy as before,” Dvorkovich told Bloomberg TV Monday at the World Economic Forum on […]

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Putin’s Mideast Gains Trump $27 Billion Loss From Iran Agreement

Middle East Map

(Bloomberg – bloomberg.com – Henry Meyer, Stephen Bierman – April 14, 2015) As Russian President Vladimir Putin has shown in Crimea and eastern Ukraine, he’s willing to take an economic hit to expand his political influence. He’s taking the same approach with Iran. Lifting sanctions and allowing Iranian oil onto global markets would threaten to deepen the plunge in crude […]

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Millions of Russians Edge Toward Poverty as Economic Pressure Mounts

File Photo of Older Russian Woman Shopping in Grocery Store

(Moscow Times – themoscowtimes.com – Howard Amos – April 13, 2015) Clutching two plastic bags full of clothes she had just collected from a charity center in central Moscow, Svetlana Burkutskaya said that rising prices were making it harder for her to find enough money to put food on the table for her three school-age children. “There is not sufficient […]

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Russia Nervously Eyes the U.S.-Iran Deal

Middle East Map

(stratfor.com – Geopolitical Weekly – Reva Bhalla – April 7, 2015) When a group of weary diplomats announced a framework for an Iranian nuclear accord last week in Lausanne, there was one diplomat in the mix whose feigned enthusiasm was hard to miss. Russian Foreign Minister Sergei Lavrov left the talks at their most critical point March 30, much to the […]

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NEWSLINK Forbes: Here’s Where Russia Shipped Oil Last Year As Ukraine, Europe Diversified.

Oil Wells File Photo

Russian oil companies are diversifying slowly away from their dependence on the European Union, just as the E.U. does the same with its long-time supplier of oil and natural gas. As a result, Russian exports to Germany — its most important market — fell between 2014 and 2013. And Ukraine shipments have fallen by nearly half.   Forbes.com: Kenneth Rapoza, […]

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Putin approves three-month extension of Ukraine’s gas discount

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(Business New Europe – bne.eu – bne IntelliNews – April 1, 2015) Russian President Vladimir Putin has approved a request by Gazprom to supply discounted natural gas to Ukraine for three more months on March 31, saying the arrangement would be reviewed later as oil prices changed. Ukraine in the first quarter of 2015 paid $329 per thousand cubic metres […]

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NEWSWATCH AP: American farmer among the winners in sanctions-hit Russia

Eurasia Map

[“American farmer among the winners in sanctions-hit Russia” – AP – James Ellingsworth – Apr. 1, 2015] AP examines the impact of Ukraine-related Western sanctions on Russia, such as increased prices for some farmers, instability in international projects, and evolving energy relations between Russia and China. The impact of sanctions, and a Russian embargo, on agriculture is apparently mixed. Russia’s ‘counter-sanctions’ ban on food imports […]

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NEWSWATCH Reuters: U.S. faces meager options for further Russia energy sanctions

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[“U.S. faces meager options for further Russia energy sanctions” – Reuters – Timothy Gardner – March 23, 2015] Reuters examines Western sanctions on Russia, including some of the remaining options for energy-related sanctions. Energy is the economic lifeblood of Russia, which vies with the United States and Saudi Arabia to be the world’s top oil producer …the sector is the main target of […]

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NEWSLINK Moscow Times: Oil Crash Is Crushing Russia

Oil Wells File Photo

The impact of oil prices on the Russian economy is well known. After crude fell 50 percent last fall, the Ministry of Economic Development forecast a 3 percent GDP contraction this year, along with 12 percent inflation. The crash in oil prices will not only test President Vladimir Putin’s domestic support. It will upend Russian foreign policy, challenging the modernization of the country’s armed forces while diminishing its influence in Asia […]

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Russia Beyond the Headlines: Middle Eastern oil players lose out to Russia in Asia

Oil Wells File Photo

As Russian oil supplies increase, Gulf states are forced to drop prices to remain competitive (Russia Beyond the Headlines – rbth.ru – Anna Kuchma, RBTH – March 12, 2015) Russia boosted oil supplies to China, Japan and South Korea by 10 million tons in 2014, increasing the proportion of oil exports to Asia from 7.2 percent to 8.7 percent. The […]

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NEWSLINK: Russia may ease Ukraine’s gas terms, but Kiev must settle its bills

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Russia may ease the terms of its gas supplies to Ukraine, Russian Energy Minister Alexander Novak told Reuters, but he said that sooner or later Kiev would have to pay for the gas Moscow is supplying to rebel-held areas of east Ukraine. …

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Russia’s dependence on oil prices may threaten national security – official

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(Interfax – February 25, 2015) Moscow, 25 February: Russian Security Council Secretary Nikolay Patrushev thinks that the aim of the Western sanctions is to put pressure on the development of Russia’s mineral resource base, while Russia’s dependence on oil and gas prices may pose a threat to its national security. “The aim of the sanctions is to put pressure on the […]

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Interfax: Kyiv must supply energy to Donetsk, Luhansk under Minsk accords – Putin

Map of Ukraine, Including Crimea, and Neighbors, Including Russia

NOVO-OGARYOVO. Feb 25 (Interfax) – The central government in Kyiv must ensure energy supplies to Donetsk and Luhansk under the Minsk agreements, which were reflected in a resolution of the United Nations Security Council and have now become an international legal document, Russian President Vladimir Putin has said. “We mentioned the Minsk agreements which were not only signed in Minsk […]

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Novak: inability to borrow worse than low oil prices

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MOSCOW. Feb 16 (Interfax) – The lack of lending sources is having a worse effect on the Russian oil industry than the low price of oil, Energy Minister Alexander Novak said in an interview with Interfax. “The main issue is the lack of lending resources, sources of financing, not the price of oil. Accordingly, due to the lack of financing, […]

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Interfax: Russia sees risk of global economic slowdown due to low oil prices – minister

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ISTANBUL. Feb 10 (Interfax) – Russia warned G20 finance ministers meeting in Istanbul about the risks of a slowdown of global economic growth as a result of the drop in oil prices and called for a deeper analysis of the impact that the drop in prices has had on the economies of various countries, Russian Finance Minister Anton Siluanov said […]

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Business New Europe: Russian coal keeps UK household lights on as winter grips

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(Business New Europe – bne.ru – Nick Kochan in London – February 5, 2015) As winter grips the UK, a group of Russian coal companies with leaders closely linked to President Vladimir Putin are enabling British power companies to keep the country’s lights on – a precarious position as the sanctions rhetoric rises once again. Three Russian firms, SUEK, KRU […]

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Russian Sanctions Might Be Obama’s Greatest Blunder

File Photo of Vladimir Putin and Barack Obama Seated Before Russian and U.S. Flags

(oilprice.com – Robert Berke – January 25, 2015) One of the greatest foreign policy blunders of the Obama Administration was the push by the U.S. for economic sanctions against Russia. That led to Russia fleeing into the arms of China for refuge. In response, Russia, Europe’s largest and most populated country, is now intent on moving its vast storehouse of […]

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Fall in oil prices could shrink Russia’s GDP by five percent

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(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH – January 21, 2015) Russian experts say that due to a six-year low in oil prices, Russia’s economy could contract by up to five percent in 2015. Moreover, the situation drastically differs from the 2008-2009 crisis when Russia was not as dependent on oil prices or under sanctions. In the […]

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Russia in for recession, high inflation even if oil rebounds to $80-$90 – RenCap

File Photo of Cash, Coins, Line Graph

MOSCOW. Jan 21 (Interfax) – The Russian economy will not see any growth and inflation will remain high in 2015 even if oil prices rebound to $80-$90 per barrel, economists at Renaissance Capital believe. At an oil price of about $60, which is the investment bank’s baseline scenario, Russia’s GDP will contract by 4.3% in 2015 and average annual inflation […]

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Double trouble – Russia 2014 vs 2008

File Photo of Cash, Coins, Line Graph

(Business New Europe – bne.eu – COMMENT: Peter Szopo of Erste Asset Management – January 20, 2015) [Charts here http://www.bne.eu/content/story/comment-double-trouble-russia-2014-vs-2008] History, they say, does not repeat itself – it rhymes. Even if this were true, history’s rhymes are clunky at best. While Russia’s current crisis has obvious parallels with the turmoil in 2008, such as the drop in oil prices, […]

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Business New Europe: Pain but no disaster in store for Russia, says Rencap

File Photo of Cash, Coins, Line Graph

(Business New Europe – bne.eu – bne IntelliNews – January 20, 2015) If the average price of oil in 2015 is $60 then Russia’s economy will contract by 4.3% and the ruble will be RUB56.4 to the dollar, say analysts at Renaissance Capital in a note released on January 20 exploring different oil price scenarios. Oil prices have fallen from […]

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Russia Beyond the Headlines: Gazprom throws down the gauntlet to Europe over gas supplies via Turkey

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(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH – January 19, 2015) Russian gas giant Gazprom says Europe must build a new pipeline from Turkey if it wants to secure energy supplies via its new route that cuts out Ukraine. Russia had been intending to supply gas to Europe that bypassed Ukraine through South Stream, which was to […]

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Interfax: Medvedev calls agreements on electricity shipments to Ukraine and Crimea mutually beneficial

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GORKI. Jan 20 (Interfax) – Agreements to ship electricity to Crimea and Ukraine are beneficial to both parties, Russian Prime Minister Dmitry Medvedev said at a meeting with Energy Minister Alexander Novak and Gazprom (MOEX: GAZP) CEO Alexei Miller. He also said that work must continue in this area. “I think that this is a form of support, in this […]

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Moscow Times: Russian Oil Firms Can Weather $50 Oil

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(Moscow Times – themoscowtimes.com – Alexander Panin – January 16, 2015) If oil stays at its current price through this year, Russia’s gross domestic product will likely shrink more than 6.5 percent, but Russian oil companies will continue to make a profit at even lower prices, analysts at the Gaidar Economic Forum said Thursday. Oil prices climbed to $48.62 per […]

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Ukraine’s Effort to Cut Russian-Gas Reliance Sees Explorers Exit

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(Bloomberg – bloomberg.com – Ladka Bauerova – January 12, 2015) Ukraine’s ambition to wean itself off gas supplies from a hostile Russia has never seemed so distant. Foreign explorers that are key to Ukraine’s future energy independence are fleeing the nation as a war against pro-Moscow insurgents in eastern regions sends the economy into freefall. Even government measures aimed at shrinking […]

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Russia 2014 Gas Exports Seen Lowest in Decade as Nations Cut Use

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(Bloomberg – bloomberg.com – Elena Mazneva – January 13, 2015) Russia, the world’s biggest natural-gas exporter, probably cut 2014 fuel exports to the lowest in a decade as consumption in Europe and Ukraine declined. OAO Gazprom (GAZP), the state-run gas-pipeline export monopoly, supplied no more than 195 billion cubic meters of fuel from Russia to the European Union, Turkey and […]

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The oil price is all that matters regarding Russia

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(Business New Europe – bne.eu – Chris Weafer – December 19, 2014) Chris Weafer is Senior Partner at Macro-Advisory, which offers bespoke Russia-CIS consulting. The key takeaway concerning the economy and the ruble from President Valdimir Putin’s press conference on December 18 is that the Kremlin does not have any strategy or plan to try and pull out of this […]

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Russia Beyond the Headlines: Medvedev urges Russia to address dependence on world oil prices

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(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH – December 11, 2014) In an address broadcast on Russia’s main TV channels, Prime Minister Dmitry Medvedev has said the country needs to wean itself off its dependence on oil prices. In order to accomplish this, Russia needs to develop innovative projects and use the sanctions imposed against it to […]

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Kremlin to sell off 19.5% stake in Rosneft in bid to raise funds

File Photo Rosneft and Russian Flags Next to Rosneft Banner

(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH- December 9, 2014) Russian Prime Minister Dmitry Medvedev has signed an order to sell off 19.5 percent of the shares in Russia’s largest oil company, Rosneft. According to experts, this might help the government generate extra cash amid falling oil prices and Western sanctions. However, this may not be the […]

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Business New Europe: Ukraine seeks power and coal from Russia and rebel-held east

Ukraine Map and Flag

(Business New Europe – bne.eu – bne IntelliNews – December 5, 2014) Kyiv has started talks with Russia as well as with Russian-backed rebels in East Ukraine in order to source electric power and coal, as Ukraine’s national grid faces a critical shortage of fuel, Ukraine’s new energy minister Volodymyr Demchyshyn said on December 4. Demchyshyn said that Ukraine is […]

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Putin’s Luck Runs Out

File Photo of Vladimir Putin Seated at Desk

(RFE/RL – rferl.org – Brian Whitmore – December 3, 2014) Vladimir Putin has been on quite a roll for about a year now. But December 1, 2014, just might turn out to be the day the tide finally turned against him. Ever since Russia’s annexation of Crimea in March sparked the worst East-West showdown since the Cold War, Moscow has […]

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Oilprice.com: Ukraine’s Next Energy Minister Will Be Bought and Paid For, As Usual

Ukraine Map and Flag

(Oilprice.com – James Stafford – December 2, 2014) A month after Ukrainian general elections, there is still no new government, and elite power circles are playing a very dangerous game with the country’s most important ministry-energy. It’s a game from which Ukraine will not recover for decades in the best-case scenario. The past week has seen a flurry of media […]

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End Of South Stream: Winners & Losers

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(RFE/RL – rferl.org – Daisy Sindelar – December 02, 2014) Russian President Vladimir Putin rarely makes an uncalculated gesture or concedes defeat. So his announcement on December 1 that Russian energy giant Gazprom was pulling out of plans to build the South Stream natural gas pipeline to southeastern Europe took many by surprise. Russia had long sought a direct route […]

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Five Forces Battering Russia’s Economy as Putin Faces Nation

File Photo of Cash, Coins, Line Graph

(Moscow Times – themoscowtimes.com – Howard Amos – December 4, 2014) President Vladimir Putin’s annual state of the union address on Thursday takes place at a time of economic pain and international isolation unprecedented during the Russian leader’s almost 15-year political dominance. More than 1,000 senior government officials will gather in the Kremlin to hear the keynote speech, listening for […]

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Ukraine approaches energy crisis

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(Business New Europe – bne.eu – bne IntelliNews – December 3, 2014) Ukraine still has to pay for more than 1bn cubic meters of natural gas that it needs in December, worth some $385m, outgoing energy minister Yury Prodan said on December 2, as a cold spell hit the country. Power generators are introducing rolling outages to cut consumption because […]

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Questions appear as Russia drops controversial South Stream pipeline

Map of Commonwealth of Independent States, European Portion

(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH – December 2, 2014) Russian President Vladimir Putin has announced that Russia is calling off the South Stream project to construct a gas pipeline to Europe via the Black Sea. According to Russian experts, the recent dramatic increase in the project’s cost could have had a hand in the Kremlin’s […]

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Interfax: Russia’s decision not to build South Stream increases Ukrainian gas transport system’s role – Ukrainian minister

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(Interfax – December 3, 2014) The Ukrainian gas transport system’s role has grown with Russia’s decision to stop the construction of the South Stream pipeline, says Ukrainian Energy and Coal Industry Minister Yury Prodan. “Surely, if there is no South Stream, our gas transport system’s role is increasing,” Prodan told journalists in Kiev on Tuesday. Ukraine has objected to the […]

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Ukrainians Cannot Count on Sanctions or Falling Oil Prices to Stop Putin, Illarionov Says

Ukraine Map and Flag

(Window on Eurasia – Paul Goble – Staunton, December 2, 2014) Many in Ukraine and elsewhere think that falling oil prices or increased Western sanctions or more sensible people in his entourage will convince Vladimir Putin to change course and end his aggressive policies, but they are wrong because none of these things will affect Putin’s pursuit of his goals, […]

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The US, Ukraine and Shale

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(Russia Beyond the Headlines – rbth.ru – Pat Davis Szymczak, special to RBTH – November 28, 2014) Pat Davis Szymczak is the founder and editorial director of Oil&Gas Eurasia, a monthly, bilingual trade publication devoted to the application of western technology to Russian and CIS oil and gas fields. If relations between Russia and the EU break down over Ukraine, […]

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Russian Oil-Output Cuts to Support OPEC Seen as Unlikely

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(Bloomberg – bloomberg.com – Stephen Bierman, Elena Mazneva – November 26, 2014) Each time oil takes a dive, the idea of Russia allying with OPEC to shore up prices gets an airing. It happened in the months after 9/11 and again during the 2008 financial crisis. Now it’s back on the agenda. Russia’s top two oil officials are in Vienna […]

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