Russian Gas Price for Ukraine Up to 6% Lower Than Cost at European Hubs - Source

BRUSSELS (Sputnik) — According to the source, Gazprom's gas prices for Ukrainian consumers were by 3.5-6 percent lower than those of the European hubs starting from the second half of 2016.

"It is expected that this tendency will continue in the beginning of 2017," the source said.

Ukraine did not pump enough gas into its underground gas storage facilities in summer, and the gas reserves by the beginning of the heating season amounted to about 14.5 billion cubic meters, compared to 17.1 billion cubic meters last year, the source noted.

"Calculations show that even in the case of reverse gas supplies from Slovakia, Hungary and Poland at the peak gas demand in Ukraine amid cold weather, the demand for gas from underground gas storage facilities in January-February of 2017 will exceed the technological restrictions. It means that there is a risk of unsanctioned diversion of Russian gas from transit cross-country gas pipelines," the source said.

According to the source, Ukraine makes gas transit through its territory economically unattractive, since the tariffs are higher than those in the neighboring Czech Republic, Slovakia and Poland, while the transportation of gas to the European consumers through the Nord Stream 2, Turkish Stream gas pipeline projects and existing pipelines bypassing Ukraine is still cheaper.

The gas talks between Russia, Ukraine and the European Commission were held in Brussels on Friday.