Ukraine's increased tariffs on Russian natural gas transit may rise its price for Pridnestrovian consumers

01/21/16 08:57

Ukraine's increased tariffs on Russian natural gas transit may rise its price for Pridnestrovian consumers

According to the chairman of the Price and Antimonopoly Committee, this decision by the Ukrainian authorities may incur up to $165 million of losses for the Pridnestrovian economy

Tiraspol, 21 January. /Novosti Pridnestrovya/. Ukraine has decided to raise the tariff rate on the transit of Russia's natural gas through its territory, announced Ukraine's energy minister, Vladimir Demchishin. «The tariff will comply with the regulator's new estimates. If I'm not mistaken, it is $4.5 per 100 km (per 1,000 m3, ed.). It is around 50% more than used to be," RBC cites Dmchishin as saying.

According to the chairman of the Price and Antimonopoly Committee, Vitaly Ulitka, in case it happens, Russia's natural gas supplied to Pridnestrovie via Ukraine may rise in price as the price of its transit is included in the formula of gas price formation. «This formula is very complex and also includes gas transportation costs. We receive gas through Ukraine and, consequently, a change in the transit price will affect the final price of gas supplied to the PMR," noted Vitaly Ulitka.

According the committee's estimates, Pridnestrovie's economy may lose $16.5 million in 2016 if this decision is put into action. Vitaly Ulitka noted that if the situation continues developing in this way, Pridnestrovie may raise gas prices for commercial consumers by 5%. At the same time, the tariff rate will not be changes for the population, says the committee chairman.

Vitlay Ulitka has not ruled out that commercial consumers may also avoid the increase in gas price if the variable in the gas price formula which is attached to the oil price goes down or Ukraine refrains from changing the gas transit tariff.

It is recalled that in 2015 the government considerably reduced the natural gas price for private businesses. Now the gas component in the gas provision tariff costs $184 per 1,000 m3. At the same time, following the government's decision and pursuant to the president's instructions, the gas price has been reduced by 30% for the industrial enterprises whose revenue from the sale of produced goods is or exceeds 70%.

 

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