Russian gas corporation Gazprom is gradually losing the Turkish market. The volume of gas supplies from Russia to Turkey this year may fall to the level of the nineties of the last century. The barely built “Turkish Stream” can remain half empty. But Russian gas supplies can drop dramatically not only to Turkey but also to Poland. This is written by the Polish portal Biznes Alert.
At the end of 2019, Gazprom completed the construction of the 31.5 billion cubic meters Turkish Stream gas pipeline, worth 7 billion euros annually. However, since 2015 there has been a downward trend in Russian gas imports to Turkey.
In 2019, the volume of purchases of Russian “blue fuel” by the Turks amounted to 43.4 billion cubic meters, which is less than in 2013. Gas relations between Russia and Turkey have been hampered by a dispute over the downing of a Russian fighter jet in Syria by the Turks. Then Ankara decided that it wanted to reduce its dependence on gas from Russia.
Two LNG terminals were built in Turkey and gas imports from Azerbaijan increased. The Turkish authorities liberalized the gas market by transferring long-term BOTAS contracts to private companies for which contracts with Gazprom were more expensive than those available on the free market. Gazprom had to give these companies a discount, reducing the profitability of their supplies to Turkey.
Gas price is the biggest problem for Gazprom in the Republic of Turkey. Russia offered BOTAS gas at $257 per 1,000 cubic meters in the first quarter of 2020 and 228 in the second quarter. In the second quarter of this year, spot gas prices in Europe were below $100. Turkey could import liquefied fuel at an average price of $63 per 1,000 cubic meters in the second quarter. Thus, LNG has largely supplanted Russian gas.
From the Russian point of view, the situation may be aggravated by the discovery of gas fields in the Black Sea, estimated at 320 billion cubic meters per year, which will give Turkey 5-8 billion cubic meters of fuel annually.
A similar process may take place in the Polish market, where the contract for gas transportation from Yamal expires in 2022. After the possible diversification of supplies through the LNG terminal in Svinuysets and the construction of the Baltic Pipe gas pipeline, as well as the introduction of a floating regasification plant in the Gulf of Gdansk, the Polish gas market will be liberalized. Poles, like the Turks, will have access to fuel from different directions and the possibility of “spot” purchases. Thus, after Turkey, Gazprom could lose Poland.