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Importers hike the price of Russian gas in Romania

WIEE notified its customers about a 2% price hike effective January 1, 2019.


Bucharest, January 15 - Neftegaz.RU. WIEE, a company that imports Russian natural gas to Romania, notified its customers about a 2% price hike effective January 1, 2019, local Economica.net reported.

 

The move came immediately after the Romanian government levied, by emergency ordinance 114/2018, a 2% turnover tax on the revenues of local energy companies, including the natural gas producers. The tax is not enforceable to natural gas importers.

 

Romania consumes some 11 billion m3 natural gas from domestic production and imports some 1 billion m3 each year. But the local reserves are depleting and the production is likely to decrease until the offshore gas starts flowing from the Black Sea.

 

The regulated natural gas price enforced by the government under the same ordinance is likely to depress local producers’ incentives and they might reduce output even more than justified by the natural depletion or direct a large part of their production to the electricity production facilities they own.

 

Since households will be supplied from local production at regulated prices, lower domestic supply will impact industrial end-users, which will be delivered a larger share of imported (expensive) natural gas.

 

Source : Neftegaz.RU