Just an interesting little bit here from a rather bullish analysis article on Gazprom’s coming rebound from the poor first quarter results from NewEurope (the author is referring to an interview with Ron Smith from Alpha Bank).
Some Russian banks are supposedly telling clients that the EU-Russia contracts are under threat. But Smith said that’s not the case at all. “Some of the our competition is pushing an idea that the export contracts for Europe are going to be renegotiated which I find highly unlikely because these are long term — 20-30-year contracts concluded under western law,” Smith said. “There is not a lot of wiggle room for the foreign buyers. They can, of course, buy below their minimum, but they have to pay penalties to do so or take an extra amount the following year so I think Europe is going to hesitate to violate those contracts because Europe still provides roughly one quarter of Europe’s gas. Say what they want, they can’t live without Russian gas.”