Jan 3, 2007

Happy New Year Gazprom

Just as Gazprom poped the bubbly on 2007, the hammer of energy politics fell upon Belarus.

At two minutes before midnight on New Year's Eve, Russia and Belarus inked a last minute deal on energy prices. This agreement signals a fundamental turning point in Russia's relations with the former Soviet state, and leaves open the question of Lukashenka's future.

Belarus will now pay $100 per 1,000 cubic meters of natural gas -- a price which will rise to $200, by 2011. By comparison, Belarus got off easy. Ukraine is paying Russia $135 for the same quanity. While Georgia now pays $235.

Should old acquaintance be forgot? It would seem so at Gazprom. But when your headquarters is a monolithic fortress of the future, you don't really need friends.

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