Gazprom Cuts Gas Supplies to Turkey

Gazprom Cuts Gas Supplies to TurkeyGazprom Cuts Gas Supplies to Turkey

Russian energy giant Gazprom has reduced natural gas supplies to private sector companies in Turkey by 10% due to a price dispute, officials at Turkey's Energy Ministry said on Thursday.

The cut came after Turkish companies refused to pay a fresh bill sent by Gazprom with higher prices after an initial deal between Ankara and Moscow envisaging a 10.25% reduction in prices was cancelled, Reuters reported.

Russia's Interfax news agency said the cut came into effect on Feb.10. Six private Turkish companies buy a total of 10 billion cubic meters of natural gas from Russia annually.

Turkey is dependent on Russia for more than half of its natural gas imports, but the two countries have been at loggerheads since November when Ankara downed a Russian warplane along the Turkey-Syria border, saying it violated its airspace.

Ankara has not asked for additional supplies from elsewhere, an industry source said, as demand currently remains low due to warm weather. "At present, there are no problems in terms of meeting gas demand," he said. Turkey said last year it had struck a deal giving it a 10.25 % price discount on gas from Gazprom, but a final signing was delayed, prompting state pipeline operator Botas to appeal to the International Chamber of Commerce.

Russia is Turkey's largest gas supplier with sales of 28-30 billion cubic meters annually worth around $6.5 billion. Turkey imports 60% of its gas and 35% of its oil from Russia.