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Russia sets 2007 gas price for Belarus at $200 per 1,000 cu m

MINSK, November 3 (RIA Novosti) - The price of Russian natural gas for Belarus and Lithuania will be $200 and $213 per 1,000 cubic meters, respectively, the Russian ambassador to Belarus said Friday.

Russia has consistently sought to raise natural gas prices for its former Soviet allies to a European level since switching to a free market economy, triggering bitter disputes with some post-Soviet states recently.

"Russia has fixed natural gas prices for its partners for next year, including for CIS states," Alexander Surikov said. "The Russian gas price for Belarus will be $200 per 1,000 cubic meters. The price for Lithuania will be $213, for Western Europe it will be a bit higher, given transit costs."

Belarus is the only former Soviet republic that still pays less than $50 for 1,000 cubic meters of Russian gas, which is about Russia's domestic price level. But Belarusian President Alexander Lukashenko earlier blasted plans to raise the price as tantamount to "severing economic ties" between the long-standing allies.

Russia's Gazprom demanded a four-fold increase starting in 2007, although the energy giant was reportedly prepared to lower the price if Belarus, a major transit point for Russian gas destined for European markets, sells its pipelines.

The two countries, which are members of the Russia-Belarus Union, which is designed to harmonize the economies of the two countries and eventually lead to full unification, have reportedly failed to agree on the value of the pipelines in question.

Lukashenko recently moved to find alternative energy sources by discussing energy cooperation with the energy-rich Caucasus republic of Azerbaijan and Venezuela.

On Thursday, Gazprom also announced plans to more than double the gas price for Georgia, bringing it from the current $110 to $230 per 1,000 cubic meters, the highest level in the Commonwealth of Independent States, a loose union of former Soviet republics.

The price hike could deal a major blow to the struggling economy of the tiny South Caucasus nation, currently engaged in an acute diplomatic row with Moscow. Georgian officials have already branded the move as political.

Energy disputes have been simmering between the countries since 2005 after Western leaning President Mikheil Saakashvili came to power in 2004. This year, Tbilisi has been in talks with Iran and Azerbaijan on gas supplies to make up for a possible disruption in Russian deliveries in the upcoming heating season this winter.

Other Russian decisions to raise gas prices were made with respect to Ukraine, which secured a price of $130 per 1,000 cubic meters for 2007 under a recent agreement between the new pro-Russian premier and Moscow, and Moldova, which will pay $170. Latvia is still in talks on a price rise to $217.

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