Russia's Gazprom said it will lower prices starting in 2009, while Prime Minister Vladimir Putin swore the country has no plans to join a gas-exporting cartel.
Where oil prices go, gas prices follow
Russian state-run energy giant Gazprom said it will charge European nations less for gas starting next year, according to Russian news reports.
"It's absolutely clear that prices for gas from the start of 2009 for European consumers will go down," Gazprom chief executive Alexei Miller told RIA Novosti news service said late Tuesday, Nov. 11.
Miller acknowledged that gas prices are at a record high, and analysts told AFP news agency they have been expecting a drop in Russian gas prices for a while now.
The EU depends on Russia for about a quarter of its gas
Russian gas price movements shadow the price of oil, which is falling -- albeit with a time lag.
"We will produce as much gas as consumers need. Gazprom's extraction capacity is significantly higher than the amount it extracts," Miller was quoted as saying.
Speaking alongside Miller, the chief executive of German chemical company BASF, Juergen Hambrecht, also predicted a reduction in gas prices for Europe, but starting in the second quarter of 2009.
Putin: Russia wants sovereignty
The European Union relies on Russia for about a quarter of its gas supplies.
Meanwhile, Russian Prime Minister Vladimir Putin sought to ease fears over the possibility of Russia joining an Opec-style cartel of gas exporting countries.
In talks with his Egyptian counterpart Ahmed Nazif, he said: "We support this idea. But we know about apprehensions and even fears voiced by certain energy consumers," news agency Interfax reported. "I wish to state once and for all: There are no grounds for such fears."
Putin's promise: no gas cartel
He said energy exporting countries should coordinate policy to ensure "uninterrupted" energy supplies to consumers, but added that Russia wouldn't forgo its independence to sign a cartel agreement with other states.
"None of us is going to cede part of our sovereignty in making decisions," Putin noted. The possibility of a gas cartel was previously discussed among Russia, Qatar and Iran.
Putin met with the Egyptian prime minister while the latter was paying a four-day visit to Moscow. His comments came one day after he said the country had to act to bolster oil prices hit by the global economic crisis.
His comments suggested that Russia was aiming to become a swing producer.
"As one of the major exporters and producers of oil and petroleum products, Russia cannot sit out from the formulation of global prices for this natural resource," Putin was quoted by local media as saying Monday.