Russia Ready for Competition in Turkey With Cheap Gas

Russia is up for competition with other suppliers for Turkey's gas and from alternative LNG sources in the region, Konstantin Simonov, director of Russia National Energy Security Fund said in an exclusive interview with Anadolu Agency.

There has been a decline in Russia's share of Turkey's gas imports with a decrease from 63 percent in 2007 to 52 percent in 2017, Simonov told Anadolu Agency, but also noted that gas is playing an increasing role in the Turkish economy.

Simonov acknowledged the serious competition that Russia is facing in the Turkish market with many alternative source options from Iran and Azerbaijan, and from LNG.

"We see a decline of the share but increasing consumption of Russian gas. But this decline shows that you have an opportunity to buy alternative gas. You have LNG terminals and you are building more, but we're not afraid of this competition," he asserted.

He cited the reason for this confidence is because Russian gas is cheaper than other competitors and explained that Turkey is continuing to consume it because Russia can guarantee supplies to meet increased demand. He also recognized the possibility that Turkey can receive Turkmenistan gas through a new pipeline as Azerbaijan, Iran, Kazakhstan, Russia and Turkmenistan reached a deal on the legal status of the Caspian Sea resources in August.

After the fall of the Soviet Union, the Caspian littoral states started negotiations over the legal status of the sea. However, wide divisions between these countries created a deadlock, preventing the sharing of the sea’s rich hydrocarbon resources. According to the agreement, an area of 15 nautical miles from the coast will be regarded as each respective country's territory.

He explained that Russia was put to the test during "the jet crisis" between Turkey and Russia in November 2015, in which Moscow opted not to stop gas supplies to Ankara.

"In my opinion 2015 was a serious test for [Russia's state-owned gas giant] Gazprom," he said, adding that if Gazprom did not stop supplies at that time when bilateral relations were at crisis point and in which Gazprom refrained from using the circumstances as a political instrument, then they will not stop for any other reason in the future.

"There was really a serious debate in Russia with major pressure on Putin but Gazprom didn't use natural gas as a political instrument," he declared.

-Russia's gas share in Europe on the rise

Simonov spoke openly in addressing the concerns that Europe has with increasing gas dependence on Russia. For the last ten years, I have heard the warnings over Europe's dependency on Russia gas as "danger, danger danger," he explained, adding that this rhetoric is groundless as there are no examples that show that Russia has used this dependency as an instrument of political pressure.

"In reality we see the increasing share of Russian gas in the European market," he said. "We're still the main player in the European gas market, not only because of cheap gas but because only Russia can supply gas at peak times during the winter.

He claimed that no other country can do so, and cited the example of Norway and the U.S., two countries that are unable to supply extra gas flows. He concluded that, "LNG won't save you in the cold winter time if the temperature is lower than forecast."

(Anadolu Agency)

EVENTS Decarbonization Policies in South East Europe – between climate change and war Webinar IENE: Energy Security in SE Europe and the East Mediterranean 27th Annual National Energy and Development Conference IENE Workshop: Prospects for the Implementation of CCUS Technologies  in Greece and SE Europe

ADVISORY SERVICES Green Bonds

PUBLICATIONS The Greek Energy Sector 2023 South East Europe Energy Outlook 2021/2022 Long-Term Gas Contracting Terms, definitions, pricing - Therory and practice More

COOPERATING ORGANISATIONS IEA Energy Institute Energy Community Eurelectric Eurogas Energy Management Institute BBSPA AERS ROEC BPIE