Armenia’s national gas distribution network declined to clarify on Thursday whether it is ready not to raise its domestic tariffs following a 10 percent increase in the price of Russian natural gas purchased by it from its parent company, Gazprom.
Gazprom announced on New Year’s Eve that it has raised its wholesale gas price for Armenia from $150 to $165 per thousand cubic meters. The announcement followed fresh talks held by the Gazprom chairman, Alexei Miller, and Armenia’s Deputy Prime Minister Grigorian as well as phone conversations between Russian President Vladimir Putin and Armenian Prime Minister Nikol Pashinian.
Pashinian assured Armenians that they will not pay more for gas despite the price hike.
For his part, Grigorian said on January 7 that the government and the Gazprom Armenia network will start discussions on the issue later this week. Gazprom Armenia will not ask Armenian utility regulators to allow it to raise the tariffs until those talks are over, he said.
In written comments to RFE/RL’s Armenian service, Gazprom Armenia said the talks will focus on the size of its profit margins that have to be approved by Armenian regulators.
“Gazprom Armenia expects that those negotiations will result in solutions that will ensure the normal functioning of the company and reliable and safe gas supplies to consumers,” it added without elaborating.
Gazprom Armenia’s chief executive, Hrant Tadevosian, said in November that his company is operating at a loss for a second consecutive year. He attributed the losses to its decision in late 2016 to cut the gas prices for households and corporate consumers.
Grigorian suggested on Monday that Gazprom-Armenia’s losses can be cut or even nullified because of a significant difference between the costs of gas purchased from Gazprom and sold to Armenian consumers.