EU and Gazprom should seek energy deal, official says

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EU and Gazprom should seek energy deal, official says

EU and Gazprom should seek energy deal, official says
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The EU’s number two energy official has said Gazprom and Brussels should reach a deal over the Russian energy giant’s dominance in the European market.

Gazprom draws 40 percent of its revenues from Europe, but the EU is investigating whether the firm’s structure complies with competition law.

Philip Lowe, the director-general of the European Commission energy directorate, told euronews that a compromise agreement should be found.

“If they (Gazprom) want to own and run the network there is a conflict of interests. Because the supplier usually wants to use the network to make sure that it’s competitors are not involved. That’s the only area where there is a need for an agreement between Russia and the European Union.”

EU law bans gas companies from operating both distribution and transport networks, as Gazprom does in some European countries.

The Commission probe focuses on whether the firm resorted to unfair competition and price-fixing in Central and Eastern Europe, which has drawn criticism from Russian energy officials.

Valery Yazev, the president of the Russian Gas Society, said: “We are worried that our previous investments could be harmed. It also harms Europe because it undermines it’s investment attractiveness.

The EU’s ultimate goal is a single energy market with harmonised prices. But Gazprom’s expansive network means it can dictate prices.

It’s also political: a dispute between Russia and Ukraine over cost in 2009 left parts of central and eastern Europe without gas for heating for weeks.