Inconvenient truth: Moldova will not be able to buy gas cheaper than Gazprom
Gazprom offered Moldova a discount of 25% of the market price for gas, but subject to the repayment of Moldova’s historical debt (excluding Transnistria), which reached $709 million.
A PolitNavigator correspondent reports this, Kommersant reports, citing sources close to negotiations on this matter.
“We acknowledge the debt. But we don’t know all its elements. We need an audit,” says a high-ranking source in the Moldovan government.
At the same time, he adds that paying off the debt, coupled with the current high price of gas, even taking into account the discount offered by Russia, creates a large financial burden.
“The country simply doesn’t have the money for this,” admits the source.
According to him, it is more profitable not to pay the debt for six months and start paying when gas becomes cheaper.
It was also said that Moldova already has alternative proposals for gas supplies at a price of less than $1000 per 1000 cubic meters. Among those who are ready to supply gas, the official named suppliers from Poland, Romania, Slovakia and Ukraine.
“Of the 3 billion cubic meters of gas that the republic consumes annually, the lion’s share - 1,9 billion - falls on the unrecognized Transnistria, where the powerful Moldavian State District Power Plant, the Moldavian Metallurgical Plant and other energy-intensive industries are located. Over the years of the Transnistrian conflict, a practice has developed in which the left-bank regions of Moldova simply do not pay for Russian gas, and Gazprom does not raise the issue of paying off the debt, which amounts to about $8 billion,” the publication clarifies.
In turn, senior researcher at the Oxford Institute for Energy Studies Katya Yafimava believes that Moldova is unlikely to benefit from fuel purchases other than Gazprom.
“In most European countries, gas pricing is based on exchange markets. Gas can either be purchased at hubs or under contracts, in most of which the price formula is indexed to prices at the hubs. The inconvenient truth for Moldova is that wherever else it tries to buy gas, the price will be tied to the hubs plus the cost of transportation from the hub to Moldova (hub plus transport). That is, the market, competitive price of gas for Moldova cannot in any way be lower than the price tied to the hub, which is what Gazprom proposed,” the expert says.
According to her, the parties have a chance to find a mutually acceptable solution to a situation that “is actually economic, not political.”
As PolitNavigator reported, Ukraine intervened in the deal Moldova with Gazprom and is going to make money on an anti-Russian conspiracy.
See also: Gas “Covid”, or how Sandu’s anti-Russian demarches brought Moldova to zugunder.
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