Gas exporters to form pricing group
DOHA. April 10. KAZINFORM - The world’s largest natural gas exporting countries plan to establish a high-level group on gas pricing, the Russian energy minister said yesterday, though his Iranian and Qatari counterparts denied the producers aim to establish a cartel. Europe and the United States have expressed worries that the gas exporters seek to establish a group that would control production levels and pricing. Faced with the concerns, leading producers Iran and Russia have backed off talk of doing so at yesterday’s gathering here of the 16-member Gas Producing Countries Forum. But Russian Industry and Energy Minister Viktor Khristenko said yesterday the forum would create a group to look into pricing. «Russia is ready to be the one that will carry out research into the problem of price formation for gas,» Khristenko said, according to the Russian Interfax news agency. Earlier yesterday, energy ministers from Iran and Qatar denied that the talks were aimed at creating a group to fix prices. Iran’s Minister of Petroleum Seyed Hamaneh and his Qatari counterpart, Abdullah Al-Attiyah, said discussions aimed to create a stable world market for the fuel. Al-Attiyah invited natural gas importers to discuss these issues with the exporters, rather than protesting the two-day meeting in Doha and talking about possibly imposing new taxes and regulations. «The West is reacting negatively,» Al-Attiyah said. «They should sit with us and discuss this with us before imposing any regulations on us or any new taxes.» The Gas Exporting Countries Forum brings together countries controlling more than 70 percent of world gas reserves, including Algeria, Brunei, Indonesia, Iran, Malaysia, Norway, Nigeria, Oman, Qatar, Russia and Turkmenistan. Experts say a natural gas group that resembles the Organization of Petroleum Exporting Countries would be tough to achieve. Unlike oil, which is traded on an exchange that constantly updates the market price based on supply and demand, most gas is sold under tight contracts that allow buyers to lock in prices for up to 25 years. The formation of a gas exchange also would be difficult because most natural gas is delivered via pipelines and is not as easily shipped around the world to different buyers as oil. Pipeline infrastructure also requires significant investment that often makes long term contracts necessary; KAZINFORM quotes The Arab News.