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Russia 2014 Gas Export Seen Lowest in Decade as Demand Falls
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 the Commonwealth of Independent States, according to UBS AG estimates. That’s about 10 percent less than in 2013.
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Gazprom revenue from supplying Russian gas abroad decreased 16 percent to $50.7 billion in January to November last year, Russia’s Customs Service said today.
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Ukraine cut gas imports from Russia 44 percent to 14.5 billion cubic meters last year, according to its national pipeline operator. That’s the lowest level of supplies from Gazprom or its associated companies since at least 1999.
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Russia’s average gas price in Europe may decline to about $275 per 1,000 cubic meters this year from $361 expected for 2014 because of slumping crude, according to Moshkov. Almost half of Europe’s wholesale gas contracts are linked to oil, with the impact showing up with a lag of six to nine months.
Brent fell 2.9 percent to $46.05 a barrel on the London-based ICE Futures Europe exchange by 3:08 p.m. in the city, trading near the lowest level in more than 5 1/2 years.
The company’s dividend, based on 2014 results, may decline 40 percent to 4.3 rubles a share, “although much depends on treatment of provisions in the fourth quarter results,” Davletshin said.
It may see more demand abroad this year, particularly if European weather gets a bit colder, according to Trevor Sikorski, head of gas, coal and carbon at London-based consultants Energy Aspects Ltd.
“But, it will be increasingly challenged for market share as LNG returns,” Sikorski said. “It might be able to expand exports but will have to do so at a lower price.”
Gazprom said last year that Turkey, its biggest export market after Germany, is a real alternative for Russia to increase gas sales abroad due to the Black Sea state’s rising needs. “The Turkish gas market is growing but is relatively small,” Sikorski said.
Gazprom transferred 65.4 billion rubles ($1 billion) of dividends directly to the state last year. That’s the highest single income source for the government as it faces a 4.5 percent contraction in the economy this year with oil at $60 per barrel, according to central bank estimates on Dec. 15.
http://www.bloomberg.com/news/2015-01-1 ... t-use.html