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Gas cartel necessity in globalization conditions-Russia source

DOHA, April 9 (RIA Novosti) - A gas cartel is a necessity in the current conditions of market globalization, a source in the Russian delegation at the sixth meeting of gas exporting nations in Doha, Qatar, said Monday.

The idea of an OPEC-style gas cartel was proposed in January by Iran, the world's second largest gas producer after Russia. President Vladimir Putin has backed the idea, although some Russian officials expressed skepticism about the initiative.

"In view of the globalization of the gas market, such an organization will [eventually] emerge," the official said on the sidelines of the Gas Exporting Countries Forum.

Russia could play a leading, "if not dominating" role in the formation of the gas cartel and in studying the market, the source told the forum, which has gathered senior officials from Algeria, Bolivia, Venezuela, Egypt, Iran, Indonesia, Libya, Malaysia, Norway, and the United Arab Emirates, whose combined gas reserves account for 70% of the world's total.

He added, however, that there were no plans to form a cartel at the moment and called for market research to begin with. The source said the pricing mechanism would have to be studied and made transparent for gas producers and consumers.

Iran's Petroleum Minister Kazem Vaziri-Hamaneh, conversely, called for establishing the cartel first and deciding on price regulation later.

"We have also heard that Russia is interested in an organization like this, and we are ready to discuss it," he said.

Argentine, Bolivia, and Venezuela have expressed support for the idea.

"We already have created a group similar to a gas OPEC, which regulates prices," Bolivian Minister of Hydrocarbons Carlos Quiroga said in a reference to the South American Gas Organization.

Russia's top delegate at the forum, Viktor Khristenko, said in the run-up to the event that no agreements on a "gas OPEC" should be expected at the meeting, adding that the idea did not make practical sense as almost all gas supplied to global markets these days was sold on the basis of long-term contracts.

The Qatari media said the forum gathered more than 100 ministers, their deputies and leading experts from gas producing nations.

Qatari Prime Minister Abdallah bin Khalifa al-Thani said the participating countries controlled two thirds of global gas resources. "It makes our positions stronger, and assigns us the key role in providing the world market with energy resources and meeting growing demand in the future," he said.