Foreign Minister Zohrab Mnatsakanian has said that Armenia will hold further discussions with Russia on the price of Russian natural gas which Yerevan hopes will be reduced soon.
The Armenian government effectively requested a price cut with a letter sent by Deputy Prime Minister Mher Grigorian to the chairman of Russia’s Gazprom energy giant, Alexei Miller, in late March. Grigorian argued, among other things, that international oil prices, which essentially determine the cost of Russian gas supplied to Europe, have fallen sharply due to the coronavirus pandemic.
Miller responded by indicating that it is up to the governments of the two countries to agree on the Russian gas price for Armenia.
Prime Minister Nikol Pashinian discussed the issue with Russian President Vladimir Putin in an April 6 phone call.
Two weeks later, Russian Foreign Minister Sergei Lavrov dismissed complaints that European Union member states are now paying less for Russian gas than Armenia and Belarus because of the collapse in international oil prices. He argued that that unlike EU consumers, the two ex-Soviet states allied to Russia buy Russian gas at fixed prices that had been set well below international market-based levels.
Grigorian countered that Russian natural gas has never been as cheap for Armenia as was claimed by Lavrov. He also dismissed Lavrov’s criticism of ongoing criminal investigations into major Russian companies operating in Armenia and the state-owned Russia Railways network in particular.
Mnatsakanian admitted on Monday the existence of problematic “issues” in Russian-Armenian relations while emphasizing that the two countries remain close allies.
“The gas issue is extremely important for Armenia, and we are going to continue to discuss it with our Russian partners,” he told journalists.
Gazprom raised the wholesale price of its gas delivered to Armenia from $150 to $165 per thousand cubic meters in January 2019. Nevertheless the cost of gas supplied to Armenian households and businesses has remained unchanged since then.
Armenia’s Gazprom-owned gas distribution network has incurred additional losses as a result. Last month it asked the Public Services Regulatory Commission (PSRC) to allow a roughly 11 percent rise in its retail prices.
The request was filed one day after Grigorian’s letter to Miller. The PSRC has to decide by June 19 whether to approve or reject it.