Gazprom Says Asia Seeking New Gas Hike

Gazprom said Central Asian countries were demanding "European prices" for natural gas deliveries next year, as it entered another round of gas talks with Ukraine.

The heads of the national gas companies of Turkmenistan, Kazakhstan and Uzbekistan made the demand at a meeting Tuesday with chief executive Alexei Miller in Moscow, Gazprom said in an e-mailed statement.

"This is probably Gazprom establishing a negotiating position before talks with Ukraine," said Ronald Smith, chief strategist at Alfa Bank.

Gazprom, which sells Central Asian gas to Ukraine at a lower price than Russian fuel, is scheduled to continue talks with Ukrainian state-run energy company Naftogaz Ukrainy this week. Gazprom curbed supplies to Ukraine for 2 1/2 days last week after talks on unpaid debt broke down.

The two sides still disagree over how much Ukraine owes Gazprom for Russian gas deliveries this year. Gazprom says it had to ship more expensive Russian gas to compensate for a shortfall in supplies from Central Asia, which had an unusually cold winter.

Talks with Naftogaz are expected to resume Wednesday, Gazprom spokesman Sergei Kupriyanov said by telephone Tuesday. He declined to comment on whether Gazprom would agree to the Central Asian producers' demand.

"The writing is on the wall," Smith said. "The time is over that Ukraine can get away with not paying international prices for its gas."