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Energy Blast – Sept 6, 2011

Whilst Ukraine has apparently prepared documents for filing a suit in court of arbitration to resolve the gas dispute, Prime Minister Mykola Azarov has rejected the notion of a ‘gas war’ with Russia and reassured consumers that supplies will not falter this winter.  Kiev has reiterated that it cannot join the Moscow-led Customs Union of Russia, Belarus and Kazakhstan, which would secure it a discount, because it is a WTO member and affiliation with the union would be incompatible with its policy of joining a free trade zone with the EU.  Naftogaz Ukrainy CEO Yevgeny Bakulin has asserted his belief that a fair price for Russian natural gas would be 230 U.S. dollars per 1,000 cubic meters, which would require a discount on current prices of almost 20%.   Reuters has a useful analysis on Ukraine’s bind, as does RFE/RL.  “Not great for the environment. In fact, I think the appropriate word would be ‘terrible'”: Professor Peter Wadhams of Cambrdge Univeristy tells the Independent how an Arctic oil leak could spell environmental catastrophe.  It would seem from this article that engineers are already preparing for the worst case scenario.  On the perils of Exxon’s Arctic partnership with Rosneft.  Is Iran softening on nuclear secrecy?  Today marks the start of Russia pumping gas through the Nord Stream pipeline.