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Energy Blast – June 5, 2009

Despite Vladimir Putin holding a meeting to discuss the Ukraine gas problem as the deadline for paying their bill approaches, ‘the situation remains unresolved’.  The European Commission will send a team to Moscow and Kiev on a ‘fact-finding’ mission to analyze the problem since Russia has said it may suspend gas supplies.  The EU Trade Commissioner says the dispute requires ‘a commercial solution‘.  Russia has warned Bulgaria that should Ukraine fail to pay for gas pumped into underground storage, then Russia may stop gas supplies.  An article in the Economist suggests that oil cannot be the panacea the Kremlin would hope it to be.  Gazprom has announced that the company has ‘all conditions to start purchases of Azeri gas soon’.  Viktor Vekselberg has declared that TNK-BP intends to increase its investments this year by $400 million.  BP has expressed support for a new pipeline under the Baltic and greater energy production.  Iran has proposed buying all of the natural gas produced at an Azerbaijani gas field in the Caspian Sea.  Russian oil major Lukoil may pay more than $1.5 billion to buy out BP’s shares in production and transport venture LukArco.