Ukraine said it halted natural gas imports from Russia on Wednesday after EU-brokered talks collapsed without a deal on how much Kiev should pay for its supplies and an interim accord expired at midnight.
Russian gas flows to the European Union via Ukraine were unaffected. The European Commission said both sides had promised gas transit west would remain smooth, but it would not relinquish its mediation efforts until there was agreement.
"From today, Ukraine is not getting gas from Russia. Transit supplies are as normal," Maksim Belyavsky, a spokesman for Ukraine's gas transit monopoly Ukrtransgaz, said.
Russia is set to strengthen its position as the biggest oil supplier to China in the coming decade with a planned second pipeline link to Chinese refineries, according to a unit of Fitch Group Inc.
Ukraine does not agree with gas discount proposed by Russia for third-quarter gas deliveries, Russia's RIA news agency quoted Ukraine's Energy and Coal Minister Vladimir Demchishin as saying on Tuesday.
Russia proposes keeping the gas price for Ukraine unchanged in the third quarter, Prime Minister Dmitry Medvedev said on Monday, a day before Russia's energy minister goes to Vienna for gas talks.
"Despite all the difficulties in our current relations with Ukraine, we should within reason make concessions," Medvedev told Energy Minister Alexander Novak and Gazprom Chief Executive Alexei Miller.
Gazprom had said Ukraine would be charged $287 per 1,000 cubic metres with no discount in the third quarter. That compares to the $247 charged in the second quarter, including a discount of $100 per 1,000 cubic metres.
Russia is bracing for more foreign asset seizures over the defunct Yukos Oil Co. after France and Belgium began enforcing a $50 billion damages award, a Kremlin adviser said.
France arrested insignificant funds in accounts of Russian companies and diplomatic missions at the local subsidiary of OAO VTB Bank, Economy Minister Alexei Ulyukayev said Thursday. Belgium earlier served Russian state-owned lenders and entities with seizure notices as part of a 1.65 billion-euro ($1.9 billion) court ruling, ordering them to declare assets belonging to the Russian state or debts to it.
Russian and Saudi oil ministers plan to discuss a broad cooperation agreement on Thursday at an economic forum in Russia's second city of St Petersburg, two sources told Reuters.
A meeting between the head of Russia's Gazprom's and Turkish Energy Minister Taner Yildiz is expected to be rescheduled for next week as both sides strive to finalise agreement on a proposed underwater gas pipeline to Turkey, a senior energy ministry official said on Wednesday.
Turkey was named as Russia's preferred partner for an alternative to its planned South Stream pipeline to carry gas to southern Europe without crossing Ukraine after Russia aborted the project in December, citing EU objections.
Russian gas company Gazprom, a leading shareholder in Russia's sole liquefied natural gas (LNG) plant, Sakhalin-2, hopes to be able to answer questions about the plant's expansion next year, deputy chief executive Alexander Medvedev said on Tuesday.
Some of the world's most powerful oil executives will attend Russia's top investment show this week, once again helping the organisers shrug off a meagre turnout from other leading Western industrialists and bankers.
Russian state oil producer Rosneft will be forced to postpone drilling a second well in the Kara Sea for at least two more years, three sources told Reuters, as a result of Western sanctions over the Ukraine crisis.
Lifting the ban on US oil exports would do little to help Eastern European countries decrease their reliance on Russian energy, a policy research arm of Congress said in a memo to US lawmakers.
A stable ruble and new tax rules are likely to support Russian oil producers’ profitability even after a slump in the price of oil, the country’s main source of export revenue, according to PricewaterhouseCoopers.
The fiscal burden declined in the first quarter, contrary to concerns Russian oil companies had expressed about rules introduced in January, Andrey Soldatenko, tax director for PwC in Moscow, said in an interview.
“If key macroeconomic factors like oil prices and the ruble exchange rate remain relatively stable, the trend may continue beyond the first quarter,” Soldatenko said last month in Ufa, Russia.
The ruble is likely to remain stable “given the latest efforts of the Bank of Russia,” he said.
Billionaire Viktor Vekselberg is out to prove that solar has a place in Russia, the world’s largest exporter of oil and gas.
Hevel Solar, a venture between Vekselberg’s Renova and OAO Rusnano, plans 22.5 billion rubles ($450 million) of solar farms through 2018 and says diversifying power generation will benefit the country.
“You don’t have to eat potatoes all the time,” Hevel Chief Executive Officer Igor Akhmerov said in an interview in Moscow. “You can have some salad as well.”
At first glance, solar in Russia makes little sense. The country has surplus energy, and the sun barely crests the horizon in midwinter in Moscow. Yet it does shine along the nation’s southern border with Kazakhstan, where Hevel completed its second solar farm in the Orenburg region last week.
Russia's top oil producer Lukoil will increase its crude exports by at least 300,000 tonnes in June due to cuts in production at its Norsi refinery, industry sources said on Tuesday.
Norway has overtaken Russia as western Europe's top gas supplier, data from state firms shows, indicating the European Union's drive to reduce its dependence on Russian energy is bearing fruit.
With Siberia’s aging oil fields slowly running dry, Russia is turning to a natural gas by-product to help maintain crude production and meet President Vladimir Putin’s target of 10 million barrels a day.
As companies including OAO Gazprom, OAO Novatek and OAO Rosneft get new Siberian gas fields up and running, they’re also boosting output of condensate, a prized, ultra-light form of crude that’s a common component of underground gas reserves.
Condensate is especially important now because it’s not covered by sanctions on Russia’s oil industry that have targeted Arctic drilling and shale projects.
Russia’s economy showed signs of recovery in the first and second quarters amid a declining dependence on oil, Russian Deputy Prime Minister Arkady Dvorkovich said.
“Oil prices are not as important to the Russian economy as before,” Dvorkovich told Bloomberg TV Monday at the World Economic Forum on East Asia in Jakarta, adding that other factors such as the global environment and Russia’s own polices influence its economy. “As far as oil prices are concerned, we can live with different prices and still grow.”
US-traded Russian stocks last week posted their longest streak of weekly gains in two years as higher oil prices and a stronger ruble boosted the outlook for companies that depend on domestic demand.
As Russian President Vladimir Putin has shown in Crimea and eastern Ukraine, he’s willing to take an economic hit to expand his political influence.
He’s taking the same approach with Iran.
Lifting sanctions and allowing Iranian oil onto global markets would threaten to deepen the plunge in crude prices, curbing revenue from Russia’s biggest export. The cost: about $27 billion, based on estimates from the central bank in Moscow.
“The strategic benefits are much more important for Russia,” said Nikolay Kozhanov, an expert at the Royal Institute of International Affairs in London and a nonresident fellow at the Carnegie Moscow Center.
“Incorporating Iran into pro-Moscow organizations, Russia is hoping to secure its share in this market or divide zones of influence.”
The Russian Energy Minister Alexander Novak said Ukraine has requested one billion cubic metres of gas imports from Russia this month.
It would treble the amount received in March and comes after Naftogaz and Russia’s Gazprom signed an interim deal for cheaper supplies of gas from Russia.
The deal, which is expected to last three month, could help provide some time as both country’s debate energy costs.
Gazprom Neft has signed an agreement which will see the company purchase a 49% stake in PetroVietnam.
A deal was signed with the state oil and gas group's chief executive Nguyen Xuan during a visit by Russian Prime Minister Dmitry Medvedev to the Vietnam.
Russian President Vladimir Putin’s government told its economic team to stick to a conservative budget for this year as crude oil prices began rising, according to two officials in Moscow.
The government rejected new forecasts prepared by the Economy Ministry this week as too optimistic, the officials said, asking not to be identified as the discussion isn’t public.
Earlier this week, the ministry raised its estimate for this year’s average crude price to $60 a barrel from $50, they said. Oil and natural gas contribute about half of Russia’s budget revenue.
Schlumberger Ltd. must satisfy a list of conditions, in part linked to sanctions, to gain approval for its $1.7 billion bid to buy Russia’s largest oil driller.
Russia’s commission on foreign investment will meet the U.S. oil-services company to go through the conditions in the next 10 days, Igor Artyemev, head of Russia’s anti-monopoly service, said Thursday in Moscow.
Schlumberger’s planned acquisition of Eurasia Drilling Co. comes as the US and Russia face off over Russia’s annexation of Crimea and its support for a separatist insurgency in Ukraine.
Energy Secretary Ed Davey has given Russian oligarch Mikhail Fridman seven days to explain why he should be allowed to retain ownership of newly acquired oil and gas fields in the North Sea, or face being forced to sell them.
Upping the ante in a standoff that could deter other Russians from investing in Britain, Mr Davey wrote to Mr Fridman saying he was considering forcing him to sell North Sea assets just acquired from German utility RWE.
RWE finalised the sale of oil and gas production unit RWE Dea to Mr Fridman's investment vehicle, LetterOne, earlier this week, ending months of uncertainty over whether the £3.7billion deal would go ahead.
Rosneft said its net profit for 2014 was $5.7billion – a 10% decrease year-on-year – caused by current economic conditions.
Russia’s top oil producer said its earnings before EBITDA were up 11.6% from the year before to 1.06trillion rubles.
Lukoil said profit fell 39% last year as crude prices slumped and Russia’s second-largest oil producer reported asset impairments from Kazakhstan to West Africa.
Net income dropped to $4.75 billion from $7.83 billion in 2013, the Moscow-based company said in an e-mailed statement on Tuesday. Impairments of $2.34 billion were partly countered by a $1.89 billion hedging gain from oil trading.
The results come after OAO Gazprom Neft posted a 31% decline in profit on Monday as oil prices plunged and a weaker ruble led to foreign-exchange losses, while OAO Novatek last week said earnings dropped 66 percent. Lukoil has cut total spending, while maintaining development deadlines for Caspian and Siberian projects.
