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Despite Russian-Turkish relations improving, gas conflicts between the two countries are starting to heat up. Friday's Kommersant business daily writes that Gazprom is preparing to file lawsuits with an arbitration court against private Turkish gas importers after failing to agree with them on the gas price for 2017. So, the Russian gas monopoly will be suing all its clients from the second largest export market after Germany, the paper says. Experts note that the politicization of cooperation between Moscow and Ankara is forcing Gazprom to protect its commercial interests in court. Sources in both countries told Kommersant that Gazprom Export has already put together the lawsuits and will most likely file them with the Stockholm arbitration court. The dispute is over this year’s gas price, which Gazprom believes is undervalued.
A slew of gas producers, among them Akfel Gas, Shell, Bati Hatti and Kibar Enerji buy around 10 bln cubic meters of gas per year from Gazprom via the Burgas-Alexandroupoli pipeline. The Russian monopoly supplies another 17 bln cu m to Turkey’s state-owned company Botas. The court battle with the gas company is already underway and the hearing may take place this May. Under Gazprom’s 2016 agreement with private companies, the price can be revised as of 2017 but if the sides fail to reach a compromise, the earlier agreed terms will stay in place.
One of the sources told Kommersant that Gazprom has suggested private importers set a temporary price for this year (higher than in 2016) that would be in force until litigation with Botas is wrapped up. After determining the price for Botas, Gazprom and the private companies would resume talks and the monopoly was ready to give them a discount from early 2017, the paper writes. However, the private importers rejected the proposal saying that the current price was fair. A source told Kommersant that Gazprom was forced to act as the low price for private importers in 2017 would undermine its position in a dispute with Botas. The Turkish sources told Kommersant that Gazprom’s position was seriously affected by the nationalization of a major private importer Akfel. After that the talks on the price were almost halted. Gazprom’s moves signal a significant change in gas relations between the two countries, the paper writes.
Moscow is discussing the possibility of increasing hydrocarbon supplies to Cuba, Vedomosti writes citing a letter from Deputy Economic Development Minister Alexei Gruzdev to the government. According to the Economic Development Ministry, Rosneft and Lukoil, which have the technical capabilities to supply oil and its products to Cuba, are hammering out the contracts but the price is not being discussed, the document says.
Russia has not supplied a steady stream of hydrocarbons to Cuba over the past years, the letter says. According to the Federal Customs Service, in 2010-2015, Moscow supplied 17,100 tonnes of oil products valued at $11.3 mln. In January-November 2016, an estimated 3,100 tonnes of oil products worth $740,000 were exported. "In our view, the successful talks on supplies of Russian hydrocarbons to Cuba will not only contribute to an increase in trade, but will also have a positive social, political and humanitarian upshot for the Russian-Cuban relations," Gruzdev wrote.
A source in one of oil companies confirmed to Vedomosti that this issue is under discussion. President of the Council of State of Cuba Raul Castro has asked Russian President Vladimir Putin to increase the oil supplies to the Caribbean island. Given that Cuba is facing difficulties with the supplies from Venezuela, it turned to Russia, the paper writes. The volume of the planned oil and fuel supplies to Cuba was not revealed in the letter.
The USSR and Cuba had close ties and Soviet oil products were supplied to the country in exchange for sugar when Cuba had to trudge through a difficult financial situation, analyst at Sberbank CIB Valery Nesterov recalled.
Russia’s interest in supplying Cuba with oil is mainly political, he said, explaining that since Havana is now restoring ties with the United States, it is therefore important for Russia to bolster ties with its Latin American friends.
A delegation from Russia’s parliament, the Federal Assembly, led by Deputy Speaker of the Federation Council (upper house of parliament) Ilyas Umakhanov, will take part in the work of the Asia Pacific Parliamentary Forum (APPF). The Russian side has prepared five draft resolutions that will dominate the agenda, Konstantin Kosachev, who heads the Federation Council’s International Affairs Committee, told Izvestia. The major issues are the unacceptability of the sanctions policy against Russian MPs, unifying efforts in the war on terror and regional economic cooperation.
The 25th session of the APPF is opening in Fiji on Sunday. Created in 1993, this forum is one of the most representative and influential international parliamentarian platforms, which involves 27 regional countries. Russia has been taking an active part in the forum since the organization was established, the paper said, recalling that Russia hosted the forum twice - in 2007 in Moscow and in 2013 in Vladivostok.
Kosachev told the paper that during this session 10 national delegations from 27 countries have already put forward 34 draft resolutions, but this does not mean that all of them will see the light after the discussion. "As a rule, a major part of them will make it to the "finals," but then they will be combined as many countries will submit similar projects," he explained.
The senator stressed that the APPF’s uniqueness is that it seeks mutual understanding rather than focusing on disagreements as lawmakers in the Parliamentary Assembly of the Council of Europe (PACE) or the Parliamentary Assembly of the OSCE tend to do.
US President-elect Donald Trump will be sworn in as America’s chief executive in a week and debate over his future policy, including Russia sanctions, is mounting, Izvestia writes. Even if Trump dares to remove the sanctions, he will face an uphill battle in doing so. The paper explains that the restrictions against Moscow can be split into two categories - those approved by the Congress and the ones personally initiated by Barack Obama. Formally, Trump may cope with Obama’s legacy and he just needs political will for that. But forcing the Congress to reconsider the sanctions policy is almost an impossible task, Izvestia says.
"Apparently, Donald Trump will listen to his advisers. A lot will depend on his meeting with Russian President Vladimir Putin. And after that he can reverse the personal sanctions since the US president has the power to do that. Some agreements should be reached and meetings need to be held," First Deputy Chairman of the International Affairs Committee of the State Duma (lower house of parliament) Svetlana Zhurova said.
Director of the Franklin Delano Roosevelt Foundation, Yuri Rogulev, told Izvestia that sanctions introduced by the US Congress often hamper the executive branch and there are some significant examples when the restrictions lasted for decades even though they were already outdated. "We don’t know what the real policy will be. Certainly, lifting the sanctions will not become Trump’s first step as the president. He won’t take unilateral steps until some agreements are reached and positions are coordinated. The situation is very difficult and the Republican won’t go against the grain. In technical terms, he can only cancel Obama’s sanctions," he explained. It is highly unlikely that Trump will reconsider the sanctions policy shortly after the inauguration, considering that he continues making contradictory statements, Rogulev noted.
James Sherr, an Associate Fellow of the Royal Institute of International Affairs, commonly known as Chatham House, and a specialist on Russia, said a change in the US policy towards Moscow may take months.
Russia’s Defense Ministry said on Thursday that it had redeployed four Su-25SM attack planes (NATO reporting name Frogfoot) to the Hmeymim air base in Syria instead of six Su-24M bombers. According to Kommersant, eight more attack aircraft will be sent to Syria soon replacing the bulk of bomber aviation deployed to the country.
The rotation of the air group in Hmeymim had already been carried out in November, a source in the Defense Ministry told the paper. The reduction in the air group envisages the withdrawal of a major part of the Su-24M bombers and possibly Su-34 strike fighters to be further replaced Su-25SM attack aircraft. Following the reduction, the sum total will reach 30 or 35 aircraft, including helicopters, the source said.
Retired Colonel Viktor Murakhovsky told the paper the redeployment of the squadron of Su-25SM is tied to the need to provide support for Syrian government forces during the offensive in northern Aleppo, the Al-Bab province and possibly in the Homs and Hama provinces.
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