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Russian officials oppose Iran's idea of creating gas cartel

Moscow, 29 January: Officials at the Economic Development and Trade Ministry and the Industry and Energy Ministry do not see any economic expediency in creating a gas cartel.

On Sunday (28 January), Iranian spiritual leader Ayatollah Ali Khamene'i spoke in favour of creating "an organization for cooperation in the gas sector, similar to OPEC".

"I do not understand why Russia would want to create a gas cartel at all. I see no sense in that," the RIA-Novosti news agency was told by an official representative of the Economic Development and Trade Ministry in a comment on the suggestion made by Khamene'i. "Especially since Iran is coming under serious pressure from outside."

The official believes that Russia does not need to coordinate its gas extraction with anybody but that it should only be led by demand.

"Why should we take upon ourselves any obligations to synchronize our actions (with anybody), why should we limit ourselves by regulations, which may boil to quotas?" he asked.

In the opinion of the agency's source, the Iranian spiritual leader's proposal is more political than economic in nature. (Passage omitted)

The head of the Industry and Energy Ministry, Viktor Khristenko, expressed a similar opinion. He believes that there are no objective grounds for creating a gas cartel.

"Why a gas OPEC? I cannot make such predictions, especially since it was not my initiative that such documents should be drawn up. I do not believe that we should move towards a cartel agreement," Khristenko said during a visit to Algeria last week.

The minister also noted that objective processes are causing the gas market to become more and more global.

"Companies are becoming bigger because of the increasing risks of developing new deposits - especially more complicated and expensive ones, because of the expanding geography of the market and deliveries and because of factors of technical safety," Khristenko said.

He noted that companies will complement one another by exchanging assets and sharing risks. (Passage omitted).