Price wars: for the III quarter of Gazprom lost $ mldr

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Gazprom has published quarterly reporting. What lies behind these figures, told a Russian expert Vladimir Milov

14 November Gazprom published a report for the 3rd quarter of 2014, from which you can understand the magnitude of the disaster that befell the export company in this period.

Directly from the published statements that are not visible because the given aggregate figures for 9 months of the year. But if you delve into old records and calculate the sales volumes in the third quarter, subtracting half-year results, you can assess the full scale of the tragedy faced by the Russian gas monopoly.

Gas exports to Europe (including Turkey and the Baltic States) fell by 15.6 percent to 40.35 to 34.04 billion cubic meters compared to III quarter last year. In most countries, exports fell very seriously.

And countries where exports grew or remained unchanged, with just a few: Turkey (% +3.4, sold in 3 quarter of 6.7 billion), Hungary (+3.3% and 1.46 billion), the Netherlands (+56%, but sold just 0.8 billion), Serbia (as many as +126%, though sold in absolute terms a bit-just 0.2 billion cubic meters) and Bosnia (0%, 0.02 billion cubic meters).

It's hard to say what more influence on reducing purchases of Russian gas-Gazprom itself supplies artificially to prevent reverse gas to Ukraine, Russian gas competitiveness, shared desire to reduce supplies from Russia in connection with the Russian-Ukrainian conflict and the threat of disruption in transit in winter.

This will need to be carefully assessed. However, the loss of 6 billion cubic meters in 3 quarter exports and a noticeable drop in sales in nearly all countries that have not had.

How much is it in numbers? Based on, say, the average price of gas sales in Europe in the first half of this year ($366 thous. cubic meters), that's $ 2.2 billion in lost revenue in quarter 3.

The situation is even worse with the export gas to CIS countries: he fell in the third quarter compared with the previous year by almost 63%, or more than 8 billion cubic meters, with 13.44 billion to a total of 5.04 billion cubic meters.

And this is mainly due to the cessation of deliveries to Ukraine: in Q3 of last year Ukraine has bought Russian 8.5 billion cubic meters of gas, and now-zero. If the volume sold least 300 thous. cubic metres, would get almost $ 2.5 billion.

Yes, Ukraine now pays for the delays, but we have this gas would sell and got money for it (especially since Ukraine began to pay), and got nothing.

Total: minus 6 billion cubic meters of sales in Europe only for one quarter and minus 8 billion-in the CIS. Loss of money approaching 5 billion per quarter. I don't remember for a long time.

Remains with the horror of waiting for the outcome of the fourth quarter, as reduced purchases of Russian gas in comparison with last year's level obviously will continue. Here are, in General, price conflict with Ukraine, the price of our poor image in the West, price-competitive pricing policies. Given the current economic realities, Gazprom's report is not very good news for Russia's ruling elite.

The author is President of the Institute for energy policy (Moscow), Vladimir Milov

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