Russia slaps Ukraine with hike in natural gas prices

ByRod Adams

In an article titled Russia, Ukraine Quarrel Over Gas, published in the Washington Post on December 17, 2005, Peter Finn describes the relationship between natural gas supplies and Eastern European politics.

Apparently, Russia is not too happy with recent efforts by its former proxy to establish a more independent political and economic infrastructure. In response, Gazprom, a company wholly owned by the Russian state government, has announced that Ukraine can no longer expect to continue to receive hugely discounted prices on its natural gas.

Under the formerly existing arrangement, Ukraine paid a price that is about 1/6th of the price charged for customers in Western Europe. The difference between the discounted price and the market price would add about $1 Billion US dollars to Ukraine’s annual gas bill and might make a number of industries uneconomic.

Dependence is a tough situation that can significantly affect independent thought and action. It will be interesting to watch how Ukraine responds to this threatened price increase.

Rod Adams
Rod Adams

Rod Adams is Managing Partner of Nucleation Capital, a venture fund that invests in advanced nuclear, which provides affordable access to this clean energy sector to pronuclear and impact investors. Rod, a former submarine Engineer Officer and founder of Adams Atomic Engines, Inc., which was one of the earliest advanced nuclear ventures, is an atomic energy expert with small nuclear plant operating and design experience. He has engaged in technical, strategic, political, historic and financial analysis of the nuclear industry, its technology, regulation, and policies for several decades through Atomic Insights, both as its primary blogger and as host of The Atomic Show Podcast. Please click here to subscribe to the Atomic Show RSS feed. To join Rod's pronuclear network and receive his occasional newsletter, click here.

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