And it just goes from the sublime to the ridiculous in Turkmenistan’s cold war with Ukraine over gas. Once again, Ukrainian First Deputy Fuel and Energy Minister and Naftohaz Ukrayiny CEO
Oleksiy Ivchenko has accused Turkmenistan of failing to live up to their gas supply obligations. As he told journalists in Paris on 16 November:

“Yesterday, for example, instead of 125m cubic metres a day they provided 112m cubic metres. This is their problem with Uzbekistan. We are protesting to them about it. We are pressing them and saying: friends, you are not fulfilling your obligations.”

In an apparently unrelated move Turkmenistan has definitively decided to raise the price for its natural gas exports by 35 percent, to $60 per thousand cubic metres. The announcement was made by President Saparmurat Niyazov during a Cabinet meeting in which he justified the hike by citing the increase the cost of gas and oil processing equipment. Further to an earlier post on this subject, an Associated Press story gives an additional and interesting piece of detail:

The price hike is likely to be felt strongly in Ukraine, which relies on Turkmenistan for about 45 percent of its natural gas, buying about 36 billion cubic metres per year. Russia buys about 5 billion cubic metres of gas per year from Turkmenistan and Iran another 7 billion.

Niyazov went to some effort to stress that the price hike would not only be affecting Russia. This is crucial as Russia has Turkmenistan over a barrel in light of the fact that they have a stranglehold over gas transit from Central Asia. Rico’s post about the Turkmen’s huffy denial of gas deals with Gazprom is directly linked with an evidently growing sense of helplessness in Ashgabat. That said the move has been on the cards for some time now.
At ITAR-TASS reported:

Niyazov first mentioned the possibility of a hike of gas prices in 2006 during his meeting with Russian Foreign Minister Sergei Lavrov in Ashgabat on October 26.
President Niyazov repeated his intention to raise gas prices for Ukraine on October 27 during a visit by Ukrainian Prime Minister Yuri Yekhanurov to Turkmenistan.

One thing is for sure, Turkmenistan have been fortunate in timing their announcement with a global surge in gas prices, a consequence of a harsh winter in Western Europe, which the UK has suffered of in particular.
Another couple of strands need to mentioned to give the story some context. First is the opening of the Blue Stream gas pipeline at a ceremony in Turkey attended by President Vladimir Putin and the prime ministers of Turkey and Italy, Recep Tayyip Erdogan and Silvio Berlusconi. The pipeline is important insofar as it is a massive boost for Russia’s export capabilities, which are in turn made possible by Turkmen supplies. An article from The Moscow Times (password required) from 10 February offer this enlightening detail:

While current volumes from Turkmenistan are almost insignificant for Gazprom operations, the contract [for the Turkmen national gas company Turkmengaz to supply Gazprom with up to 80 billion cubic meters annually by 2009] was seen as giving the company time to develop the remote but vast Yamal fields in western Siberia.

Another matter is Gaz de France’s intention to utilise underground natural gas tanks in Ukraine from next year to store gas imported from Russia, according to comments made by Ivchenko at a recent press conference. And then there is the agreement between Russia and Ukraine, to proceed with a natural gas pipeline project to increase capacity of the gas transit system shipping gas to the European Union. This all goes to illustrate the intricate web of interests that developments in gas politics represent.

UPDATE: Interesting related feature article at IWPR.