Serbia purchased natural gas from Russia in the first quarter of this year at an average price of $1,100 per 1,000 tonnes, experts from the journal Makroekonomske Analize i Trendovi (MAT – Macroeconomic Analyses nd Trends) have calculated.
In the new issue they refute the claim that due to “brotherly relations with Russia,” Serbia has secured the lowest gas price in Europe.
“The price of gas is not fixed, but is changing dynamically, in line with changes in the crude oil market. That is why the agreement with Russia is not a guarantee that Serbia will always have the lowest price of gas. If we look only at the gas price in March this year, which is calculated using the so-called crude oil formula, the increase in crude oil prices did affect the price, as it is higher now than in the mid-2021 and will be quite high in the coming months,” MAT experts said.
As a result of this crude oil price, the price of natural gas rose to $628 per tonne, and in March, Romania and the Czech Republic bought gas from Russia at a lower price than Serbia. On the other hand, as a result of a more significant slowdown in prices on the global gas market in late March, the total average gas price that Serbia paid in that month was slightly more favourable than during the entire January-March period.
MAT experts have also estimated that the agreement between Serbia and Russia on the delivery of 2.2 billion cubic metres of gas over the next three years will ensure a secure and stable gas supply in the medium term. Serbia’s “triumph,” a term used by the Serbian top officials, vitiated the second part of the agreement, which says that all other quantities of gas must be paid in line with the current price on the free market. Therefore, in the first quarter, the price of 487.9 thousand tonnes, or 38 percent of the imported gas from Russia, was the same as the gas price on the free market, i.e. Serbia paid a price that was 4.2 times higher than the one calculated according to the crude oil formula.
The President of Serbia, Aleksandar Vučić, recently agreed with the President of Russia, Vladimir Putin, to deliver 2.2 billion cubic metres of gas over the next three years, a period which began on June 1st. The price of that gas quantity, calculated according to the crude oil formula, is expected to be between $310 and $408 per 1,000 cubic metres, but Serbia needs another 800 million cubic meters, which it will have to buy at free market prices.
(N1, 06.06.2022)