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Energy Blast – Nov 13, 2008

Vladimir Putin has threatened to call off construction on the $9.4 billion Nord Stream gas pipeline from Russia to Europe, suggesting that Russia could just simply use the resources to build more expensive LNG terminals instead, unless Europe increases its support for the project. The EU is about to publish a strategic review of energy security, focusing on European dependence on Russian supplies as a key factor in foreign policy. Gazprom is reassessing its gas prices for Central Asia ahead of the winter, with analysts expecting the outcome to see Europe’s prices drop, and Ukraine’s prices to go up. Egypt and Russia are studying the possibility of pooling resources to liquefy Russian gas for delivery to Europe. China has denied reports that talks of a $25 billion oil loan for Russia have been suspended due to disagreements over interest rates and state guarantees. Oil priced at $55 a barrel is hitting emerging economies hard, particularly Russia and Kuwait, and heavy export tariffs have forced many Siberian producers to sell as low as $10 a barrel.