Nezavisimaya Gazeta
Gazprom confident of European market position
Russia’s Gazprom is confident of its position on European markets, where consumption is growing and prices are likely to surge 15%, to around $350 per 1,000 cubic meters.
Analysts do not believe Gazprom’s strong export position will be affected by the reduction of its European market share from 25% pre-crisis to the current 22.5-23%. Its domestic sales margin is also high enough to mean it can relax for another six months.
“The international markets are favorable, so we expect good export results,” Pavel Oderov, head of the international business department, told the Moscow International Energy Forum Russian Fuel and Energy in the XXI Century.
The Russian gas giant has been increasingly optimistic this year. Alexander Medvedev, who heads Gazprom Export, had previously said the company expected to export $72.4-billion worth of natural gas in 2011. He also expected west European exports to grow in the fourth quarter of the year when the Nord Stream pipeline comes into operation.
Gazprom forecasts the average export price for its gas supplies to Europe at around $352/1,000 cubic meters in Europe in 2011, compared with $306 in 2010. This year, the company estimates it will export 151.5 billion cubic meters of gas to Europe, up 9.3% from 139 bcm in 2010, the company told investors in February.
Gazprom, which provided a quarter of Europe’s gas supply before the crisis, now controls no more than 23% of the market because some customers opted for cheaper suppliers and demanded that Gazprom change its oil-indexed long-term contracts.
But the situation is changing with gas consumption growing in Europe. The nuclear disaster in Japan has also played into Gazprom’s hands: not only has it fueled expectations of increased gas supplies to Japan, it has also prompted a renewed anti-nuclear feeling across the continent, inevitably pushing European supplies up as well.
Dmitry Alexandrov, an analyst with Univer brokerage, believes there are several indirect signs of Gazprom’s strong business position. “The company has not unveiled any plans to boost gas production and has not given other suppliers access to its pipelines. Its European customers have not canceled their contracts. Gazprom is not desperate for a greater share of the European market now. Its domestic sales margin is high enough.”
Mikhail Krutikhin from the RusEnergy consultancy shares this view: “It is hard to forecast fluctuations in gas consumption now. The winter heating season is nearly over, and prices should fall in line with the expected seasonal change. On the other hand, European consumers are hungrily pumping fuel into their underground storage tanks, helping keep up demand. Gazprom can be confident that its income will remain steady through the third quarter.”
Rossiiskaya Gazeta
Yury Gagarin statue to grace London
A statue of Yury Gagarin, the world’s first cosmonaut, will be unveiled in London on July 14 to commemorate the 50th anniversary of his visit to Britain, those behind the project announced at the British Council’s London headquarters last week. Mounted atop a white Portland stone pedestal, the aluminum and zinc, silver-hued monument will stand right in the heart of the capital, next to Trafalgar Square, opposite the monument to legendary British explorer James Cook. The monument to Gagarin will be an exact replica of the one erected in Lyubertsy outside Moscow, where he attended a vocational school. Choosing between this one and the more imposing statue on Lenin Avenue, the British opted for the work by well-known sculptor Anatoly Novikov: his Gagarin seemed to them to capture the cosmonaut’s natural charm and humanity.
Over the past two weeks, the name Gagarin has been featured extensively in the British press. This may be due to February’s agreement that 2011 would be the Russian-British Space Year, or there could be a more compelling reason to recall April 1961: the desire to reevaluate the Soviet triumph.
Was the Vostok mission, in fact, a “waste of space?” This is the question asked in the Daily Telegraph by Gerard DeGroot, the author of Dark Side of the Moon.
Why were the Russians first to launch a satellite, first to launch a dog and first to launch a man into space, if the Americans were, as they claimed, the technologically superior nation? The British expert believes they excelled at these stunts because they were so bad at building nuclear weapons. Their bombs were inordinately heavier than American ones of a similar payload. A heavier bomb necessitated a bigger rocket to carry it on a transcontinental trajectory. The Russians soon realized those rockets, pointed skywards, could be used to carry symbols of dominance into space.
The anniversary of Gagarin’s flight has let a kind of genie out of the bottle, and with it the issue of whether or not we need a space exploration program at all. This has been discussed at length in Britain’s The Daily Telegraph and The Financial Times.
Despite that, the anniversary has become a global event. When the new Russian ambassador to Britain, Alexander Yakovenko, handed his credentials to Queen Elizabeth II, she enthusiastically described her meeting with Gagarin, which left a lasting impression on her. Initially the British monarch and her government had no plans to meet the Soviet cosmonaut. But the thronging multitudes who turned out to welcome Gagarin made it impossible for 10 Downing Street and Buckingham Palace not to fete such a guest.
Now, as she travels to and from Buckingham Palace, her Majesty will again be able to see Yury Gagarin, the Soviet cosmonaut who has returned to her capital.
Vedomosti
Editorial: Lousy motives
Russia's WTO accession is one of the few issues to make Prime Minister Vladimir Putin bristle. There is no reason for Russia to abide by WTO requirements until it accedes to the organization, Putin said Friday at a meeting in St. Petersburg.
According to Putin, Russia would be forced to “perform duties, bear costs while not receiving any benefits from membership.”
“If we start fulfilling WTO commitments while not being a member, our partners will lose any incentive to accept us into the organization, they’ll say ‘why the hell should we accept them, if they're complying with everything anyway?’” fumed Putin.
There is certainly some truth in these words. Over the 17 years of work to join the WTO, Russia has voluntarily adopted a number of limits on how it acts. Even though there is no technical requirement for it to do so, the idea was it would demonstrate serious intent. As a result, today the average protective tariff in Russia is about 10%, and in terms of domestic-market protection, Russia is on a similar level to that of the most liberal WTO members.
In addition, WTO membership would not benefit Russian exporters. There are extensive antidumping measures, but with Russia outside the WTO, exporters cannot adequately respond to the often less than well-founded claims made against them. This is patently unfair.
But responsibility for the fact that Russia, as yet, has reaped no rewards from the WTO, largely rests with the Russian government and Putin himself. Every time Russia seems to be nearing the home stretch on its road to the WTO, Putin makes a sudden move that sets things back.
In June 2009, with Russia closer than ever before to WTO membership, Putin, unbeknownst to President Medvedev, suddenly announced that Russia is withdrawing from the ongoing negotiations, planning instead to join the WTO as a Customs Union. Officials did what they could, but it was obvious that, far from being a seriously calculated move, this was an improvised move on Putin's part. A month later, Medvedev disavowed Putin's statement – it turned out that group accession to the WTO is not possible.
This move postponed Russia's accession to the WTO for at least two years, and not only because Russia damaged its reputation in the international community. The basic document governing Russia's accession, the Working Group Report on Russia's WTO accession, had to be rewritten taking account of the Customs Union.
The stream of resentful ultimatums simply conceals a fundamental lack of interest in accession. Russian business still only sees the WTO as a threat. Russia's leaders do not really understand the benefits of membership, but have a clear vision of the limitations that the WTO imposes in terms of public procurement and transparency. There are no influential groups in Russia that want to join the WTO. President Medvedev hopes that Russia will join in 2011, but this is unlikely – there will always be some reason to quarrel with the WTO.
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