Ukrainian gas imports spending halved in 2016
22 February 2017
In 2016, the Ukrainian economy cut its spending on natural gas imports by half, down to USD 2.2 bln (10.9 bcm of natural gas) vs. USD 4.5 bln (16.5 bcm of natural gas) in 2015, according to a State Statistics Service report on Feb. 22. Natural gas was imported only from the EU, with an average price USD 200.9/tcm. In 2015, 37% of the natural gas imported arrived from Russia. The average price of gas imports was USD 273.8/tcm in 2015.
Alexander Paraschiy: In 2016, Ukraine saved USD 2.3 bln on gas imports spending, as compared to the previous year. That is very close to what we predicted for the year. Lower import prices and a drop in consumption, after local gas prices grew to import parity level, stand behind the outcome. Unfortunately, for 2017 we can hardly expect the declining trend to continue. Gas prices are growing amid recovering oil prices and we should be ready for the average gas price to be above USD 200 per tcm. Moreover, the gradual strengthening of the economy very likely will be driving stronger demand for gas. We expect 12 bcm of gas imports in 2017 with an average price close to USD 230 per tcm. That will require an extra USD 0.5 bln of foreign currency spending on natural gas purchases this year (USD 2.8 bln of natural gas imports spending in 2017).
