This cut came as a result of a price dispute after Turkish companies received a fresh bill sent by Gazprom which included higher prices than what had been initially agreed upon between Ankara and Moscow.
An agreement had been achieved last year for a 10.25 percent discount on the price, however was cancelled this year as, according to RT, Gazprom is not willing to continue the discount due to low oil prices in international markets.
According to Russia’s Interfax news agency the cut came into effect on February 10, affecting six private Turkish companies which buy a total of 10 billion cubic meters of natural gas from Russia annually.
Turkey and Russia enjoyed a ‘honeymoon period’, particularly focusing on trade and energy supply, before their engagement in the Syrian conflict soured relations. For almost a decade the countries grew continually closer together building strong economic ties. In this time Russia became Turkey’s number one importer of natural gas, which is the dominant fuel in Turkey’s energy portfolio.
Despite tense diplomatic exchanges at the moment, Russia remains Turkey’s largest gas supplier with sales of 28-30 billion cubic meters annually worth around $6.5 billion.
Speaking for Anadolu Ageny Volkan Ozdemir, the head of the Institute for Energy Markets and Policies (EPPEN) said that “Gazprom can make such ‘warnings’ by making short term gas cuts, however this can create some risk for the company’s market position in Turkey,”
“Gazprom is not happy with its prices for Turkey’s private importers and they are also not happy with the partnership structure of these companies.”
Given the current situation with Moscow and Ankara’s enduring reliance on energy imports from Russia, Turkey has made one of its primary goals the diversification of energy supply, either by creating more incentives for coal and renewables, or by contracting with other natural gas rich countries.