Exports of Russian gas to EU up in first half of 2014
Deliveries of Russian gas to both Europe and Turkey rise sharply in first half of 2014 as tension between Russia and Ukraine persists.

Deliveries of Russian gas to Europe and Turkey rose by 2.5 percent and 9 percent respectively in the first half of this year as the tension between Russia and Ukraine persisted.

The increase took place even though Russia and the West have imposed sanctions on each other.

According to the Russian state energy company, Gazprom, deliveries of natural gas to Europe rose more than 2.5 percent over the same period last year, to 80.75 billion cubic meters.

"In spite of the tension between the West and Russia it is hard to claim that this had some immediate implications on gas trade," said Hasan Selim Ozertem, director of the Ankara-based Center for Energy Security Studies. "European economies are on a growth track after the 2008 financial crisis and this causes increasing demand for energy. As a result, the flow of Russian gas to the West increased this year."

Gazprom has delivered 1.17 billion cubic meters more gas to Turkey in the first half of this year than during the same period in 2013 -- 14.07 billion cubic meters, up from 12.9 billion cubic meters last year.

Natural gas consumption in Turkey has been increasing over the past 20 years and now accounts for one-third of the energy supply in Turkey. Household and industrial demand in the country is increasing as the country's economy does the same, growing 4 percent last year. And electricity production from hydroelectric power plants decreased this year due to low rainfall.

Gazprom’s natural gas supplies to Europe have increased due to the colder-than-average temperatures at the beginning of 2014, as well as a decline in gas supplies from Algeria, Libya, Nigeria, Norway, Qatar and the UK.

Russia currently supplies 25 percent of Europe's gas imports, and many European countries rely almost entirely on the country for their imported gas.The average price of gas supplies to Europe in 2012 was $402 per 1,000 cubic meters and fell by 5.5 percent in 2013 to $380.

According to the country’s Energy Ministry, Turkey purchases 42 million cubic meters of Russian gas daily via the West Stream pipeline, which supplies 12.5 percent of Turkey's natural gas from Russia through Ukraine. Other gas suppliers to Turkey are Iran, Azerbaijan, Algeria and Nigeria.

Russia has become Turkey's biggest natural gas supplier, with Turkey importing more than half its annual 45 billion cubic meters from Russia's energy giant, Gazprom.Turkey's energy import bill decreased by 7 percent in 2012, falling to $55.9 billion from $60.1 billion.

Gazprom sold 162.7 billion cubic meters of natural gas to Europe last year, out of which 26.6 billion cubic meters, 16 percent, was sold to Turkey. Turkey is Gazprom's second largest market in Europe behind Germany.

"Energy is backbone of bilateral trade between the two countries," Ozertem said. "The drought season in Turkey the electricity generation from hydroelectric power plants decreased and this decline was substituted with natural gas. This caused a dramatic increase in Turkey's consumption of gas in the first half of 2014."

Ukraine and western powers blame Russia for inciting the unrest in eastern Ukraine, a region with a Russian-speaking majority, with the aim of dividing the country.

The conflict has ravaged the region since April, when pro-Russian groups declared independence in the region in a referendum during violent clashes.

The tension peaked when Malaysian Airlines Flight 17 was downed in Ukraine on 17 July, leaving 298 people dead.

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Last Modified: 2014-08-15 07:54:43
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