Wednesday, September 15 2021 12:07

ArmInfo.The unprecedented rise in gas prices in Europe and membership in the EAEU, in theory, open up new opportunities for Armenia in the direction of lowering  the existing price for Russian gas. A similar opinion was expressed  to ArmInfo by an expert on energy security Vahe Davtyan.

According to the data of the marketplace, on September 15, the price  of gas in Europe in the course of trading on the ICE exchange  exceeded $ 840 per 1,000 cubic meters. As of 10:07 am, the value of  October futures at the TTF hub in the Netherlands reached $ 842.5 per  1,000 cubic meters.

"The problem is that lowering the cost of Russian gas for a member of  the EAEU Armenia requires an elementary thing - the Armenian  government must understand what energy diplomacy is. Relevant  institutions and lobbying bodies are needed to understand,  particularly analyze, calculate and predict trends in the energy  market. "Without it, energy diplomacy remains an empty expression,"  the expert said.

Davtyan explains the current situation on European exchanges as the  world economy overcomes the shock caused by the coronavirus pandemic  and the subsequent paralysis. As well as a significant increase in  the influence of the Russian Federation on the European market,  including through the formed gas shortage due to the temporary  suspension of the operation of the key Yamal-Europe gas pipeline.

Noting that the export price of gas at $ 170 per 1,000 cubic meters  is included in the Gazprom budget, the expert emphasized that the  sale of gas at current prices will allow the company to receive huge  excess profits. This, in turn, creates the possibility of a  significant softening of the tariff policy of the Russian company in  relation to key and traditional partners. Given the emergence of such  a possibility, in the case of Armenia, in Davtyan's opinion,  everything depends on the position and steps of Yerevan.

The expert believes that the way out in this direction is Armenia's  transition to spot trade in gas, which, however, requires the  creation of appropriate exchanges. In this light, Davtyan assesses  last year's letter from the Deputy Prime Minister of Armenia Mher  Grigoryan to the head of Gazprom Alexei Miller with a request to  revise the prices for gas supplied to Armenia as absurd. According to  him, Gazprom did not and could not respond to this letter due to the  elementary existence of spot gas trading and gas trading based on  long-term contracts, which provides for price fluctuations.

"Another problem is the conclusion of gas contracts by Gazprom with  Armenia of shorter-term gas contracts than before. So if earlier  contracts were concluded for a period of one year, now their terms  fluctuate between 3-4 months. And this speaks of distrust towards the  Armenian government. Another obstacle on the way to the correct  observance of the interests of Armenia is that, as a rule, all gas  diplomacy between Moscow and Yerevan is limited to the adoption of a  decision by Moscow and the agreement of Yerevan with this decision,"  the expert summed up.