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Energy Blast – July 9, 2009

Oil has returned to the $61 mark, from a seven-week low.  President Medvedev has told leaders at the G8 summit that it is impossible to regulate oil prices and that $70 to $80 per barrel is a good range.  Russia has refused to pledge support for a G8 proposal to cut greenhouse gases by 80%, with Arkady Dvorkovich saying ‘we will not sacrifice our economic growth to meet emissions cuts’.  Naftogaz is purchasing about 120 million cubic meters of gas per day this month, compared with 33 million cubic meters in June, as Ukraine seeks to increase the amount of gas it can pump into storage.  Two of Europe’s biggest energy suppliers, E.ON and GDF, have been fined €553m each by the European Commission after it was revealed they had struck a non-competition deal.  Is competition for energy markets the biggest issue between Russia and the US?  A bad week for Shalva Chigirinsky; the co-owner of Sibir Energy had his offices searched by police looking for evidence of tax evasion.  It has also become clear that Mr Chigirinsky borrowed $325 million from Sibir, rather than $115 million originally disclosed.