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Energy Blast – April 29, 2008

Italian Prime Minister Romano Prodi has turned down a Gazprom offer to become chairman of the South Stream natural-gas pipeline. One article links the offer to Gazprom’s attempt to “muscle up politically”. BP says profit at TNK-BP rose more than fourfold in the first quarter. Greek Prime Minister Kostas Karamanlis arrives in Moscow today to discuss energy cooperation. A new survey says that state-run energy giants Rosneft and Gazprom rank higher than privately held LUKoil in terms of revenue transparency. Ukrainian Prime Minister Yulia Tymoshenko says that Ukraine has sent its last payment to Russia, “which completely settles the accumulated debt for natural gas.” Iran and Russia have discussed outlines for a package of proposals aimed at defusing concerns that Iran is using its nuclear program as a cover for weapons development. Iran has dismissed objections from big Western consumer nations to setting up an OPEC-style gas body. Russia and Iran have the world’s first and second largest gas reserves, respectively. As oil prices rose over the last years, “basic economics suggested that consumption would fall and supplies would rise as producers drilled for more oil.” But neither has happened. Russian oil firm Surgut says it may lose a third of production long term if the government does not alleviate its tax burden.