Iran and Russia to Establish Joint Energy Committee

03.03.09 (TEHRAN) Iranian Oil Minister Gholamhossein Nozari and Russian Energy Minister Sergey Ivanovich Shmatko have agreed to establish a joint energy committee.

In a meeting in Tehran, Shmatko said, “Iran and Russia have close relations in the energy sector and the ground is prepared to enhance cooperation in this field.”

An Iran-Russia working group on energy will be meeting in Tehran in the near future, he stated, adding that the two countries are interested in carrying out joint projects in other countries. He went on to say that the current situation of the oil market does not serve the interests of oil-producing countries, so OPEC members should devise solutions to stabilize the market.

The Russian official proposed that Iran would begin selling its crude oil on Saint Petersburg’s stock market as a step toward finding alternative markets for oil products.

Nozari said that the two countries have been holding negotiations on proposals for natural gas swaps, construction of a refinery in the Caspian Sea region and the Neka‑Jask pipeline, as well as exploration and development of oilfields

Chu: Demand for Oil to Increase

U.S. Energy Secretary Steven Chu, a champion of renewable energy and biofuels, has a clear position about the future of oil.

He says global demand for it will increase over the next two decades and even with more efficiency and alternative fuels, prices will increase again. In the long run, over the next two decades, he said, he's certain the price of crude will be significantly higher than today.

Crude oil has dropped from a high last summer of $145 a barrel to a recent low of about $34.

Gas is Flowing Again

14.01.09 (KIEV): After nearly a week of shutdowns that left 18 European countries facing severe energy shortages in a mid-winter cold snap, gas briefly began flowing again on Tuesday through the 4,000-kilometer pipeline connecting Russian gas fields with Europe via Ukraine.

The tentative deal started to fall apart almost immediately amid an escalating war of words between Moscow and Kiev. By Tuesday evening the gas flow had been blocked somewhere in Ukraine, frustrating European observers, and both sides were back to blaming the other. The perennial dispute between the two former-Soviet states over prices and terms of transit is now developing into a crisis that threatens to paralyze economic relations and plunge Russia and the West deeper into diplomatic crisis.

Moscow maintains it's simply a matter of weaning Ukraine from the Soviet-era subsidies that saw it paying less than half the global market price for its gas as recently as last year. Beset by economic woes, Ukraine's ability to pay the $450 per thousand cubic meters that Russia is now demanding seems uncertain. Ukraine relies on Russia for 75 percent of its gas needs, and the fuel is essential to power the steel and chemical industries that are the economic backbone of the former Soviet country of 50 million.

Russia has repeatedly accused Ukraine of sabotaging Europe-bound deliveries by illegally siphoning off gas that it's unwilling to pay market rates for. Alexander Medvedev, deputy CEO of the Russian state gas monopoly Gazprom, added a fresh stick of dynamite to that charge Tuesday, suggesting that "a completely different country" may be orchestrating Kiev's behavior. That's a likely reference to the US, which last month signed a "strategic partnership" with Kiev, which Moscow reads as support for Kiev's bid to join NATO.

The rhetoric between Moscow and Kiev has flared to new heights in recent days, with Russian Prime Minister Vladimir Putin accusing Ukraine's warring politicians of stealing gas to fund their political campaigns, and Ukrainian President Viktor Yushchenko replying that Russian claims are untrue and designed to "humiliate" Ukraine.

Russians to Oversee Ukrainian Piplelines?

08.01.09: The European Union says Gazprom is insisting that Russians be included in the monitoring mission overseeing Russian natural gas as it flows through Ukraine pipelines.

Moscow's insistence to have Russians checking the gas flow through Ukraine goes against an agreement the EU had with Kiev to limit the group to EU observers alone.

Agreement on an observer mission would speed up the return of gas supplies from Russia to Europe, which is suffering a bitter winter cold snap.

Ukrainian officials have denied Russian accusations that they have siphoned off gas intended for Europe, saying instead they needed to use some of the Russian gas to keep the pipelines running.