There are no real alternatives to Russia today in terms of gas supply volumes and capacity for Armenia: Simonov

Konstantin Simonov, Director General of the National Energy Security Fund, spoke to Alpha News on the sidelines of the 19th Verona Eurasian Economic Forum in Istanbul about whether Armenia, under current conditions, could find an alternative to Russian gas, especially at such a low price.

“This question is fairly easy to answer. Even in a situation far removed from the current one, it would be practically impossible, simply for technological reasons. Today there are no real alternatives in terms of gas supply volumes and capacity for Armenia. And under current conditions, as you understand, it’s even harder, because gas prices worldwide are very high. You can look at what gas costs at European hubs right now. As we know, the wholesale price is hovering around $1,000 per 1,000 cubic meters.

So Russia’s position also needs to be understood: there is no political pressure on Armenia here. It’s simply no secret that, apart from Belarus, Armenia gets gas at the lowest price of all Gazprom’s partners. Armenia has a special price, and that is precisely because of its participation in integration projects, in the Customs Union. In other words, it is a price for partners in economic integration. If there is no integration, then the price may well be different. We’ll see how much it rises, but the logic needs to be understood, and it’s perfectly clear. Again, there is no political pressure. It’s simple logic: if you don’t want to take part in economic projects, in economic integration, then it’s simply strange to expect the cheapest gas. Again, Armenia has the lowest price after Belarus. But Belarus, as you can see, is actively developing its economic partnership with Russia. Belarus has no desire whatsoever to leave the integration projects. That’s all there is to it.

So there’s no finding an alternative,” Simonov said.

The expert added that Azerbaijan and Iran would not be able to supply Armenia with gas in the necessary volumes, let alone at a comparable price. “Azerbaijan has no spare gas right now, because it sells all of its gas to Europe. There’s a queue in Europe for Azerbaijani gas, and it gets snapped up. Iranian projects are technologically extremely complicated. So, again, it will actually be very difficult to find this gas, and its price will certainly be higher than Gazprom’s.

That’s why I think Gazprom is unlikely to raise the price more than twofold. But even if you add the same amount again to the current price, that is, double it, it will still be lower than the potential cost of alternative supplies. So objectively, it will be cheaper to pay the new price. And there may be no new price at all if Armenia makes the right decision. But the choice here is up to the Armenian government,” Simonov concluded.