The Energy Ministry is investigating ways of reducing taxes on undeveloped gas fields, having seen that even with high oil prices most projects would not be financially solvent.  Ukraine's energy company Naftogaz has said that to avoid the possibility of a gas suspension, European firms should consider buying Russian gas and storing it in Ukraine.  Russian gas exports to Europe via Ukraine fell 45.5% in January-May 2009, year-on-year.   The European Commission has cautioned Gazprom and Naftogaz to secure a long-term contract to maintain steady supplies of gas to Europe.  Sergei Lavrov has met with EU ambassadors and 'positively assessed Russian-EU cooperation' over this issue.  The FT reports that a lack of investment in modernizing the energy infrastructure of central and eastern Europe is an obstacle to guaranteeing upplies.  If oil rises to $90 a barrel next year ...

The President of Russia’s Gas Union insists that the financial crisis will have no effect on the country’s major natural gas pipelines. Will OPEC respond to the drop in oil prices with a cut in production? Likely so, says The Economist. The President of South Korea has urged his population to reduce their energy consumption in order to protect the economy from the effects of the global crisis. Will Kazakhstan’s national oil fund save its economy? Ukraine's energy ministry has approved a tender from Russia’s Atomstroyexport to construct a nuclear power plant.

‘Russia is seizing on record oil and natural gas prices to market its nuclear reactors abroad and plans to gain as much as 20% of the global market.’ The Energy Ministry expects Russian gas exports to Europe to rise by almost 38% by 2015, although is less optimistic for China. Kazakhstan’s oil industry is still seeing strong foreign interest despite borrowing issues.

by Edward Hugh: BarcelonaWell the action in Russia this week has moved on slightly, and the damage has started to spread from pressure on the domestic stock market (accompanied by capital flight) to the real economy - via a very rapid tightening in credit conditions for Russian domestic users. We are also seeing a rapid slowdown in Russian manufacturing industry as internal demand slows while the inflation-driven decline in cost competitiveness continues to make imported products (where available) an attractive alternative to the home produced variant.Emerging-market bonds have been generally falling this week as the U.S. Senate's approval of a $700 billion bank rescue package did little to revive demand for riskier debt, and Russia has, unsurprisingly, been among the worst affected. The extra yield investors demand to own developing-nation bonds rather than U.S. Treasuries rose 8 basis points yestreday to 4.14 percentage points after widening ...

by Edward Hugh: BarcelonaWell the action in Russia this week has moved on slightly, and the damage has started to spread from pressure on the domestic stock market (accompanied by capital flight) to the real economy - via a very rapid tightening in credit conditions for Russian domestic users. We are also seeing a rapid slowdown in Russian manufacturing industry as internal demand slows while the inflation-driven decline in cost competitiveness continues to make imported products (where available) an attractive alternative to the home produced variant.Emerging-market bonds have been generally falling this week as the U.S. Senate's approval of a $700 billion bank rescue package did little to revive demand for riskier debt, and Russia has, unsurprisingly, been among the worst affected. The extra yield investors demand to own developing-nation bonds rather than U.S. Treasuries rose 8 basis points yestreday to 4.14 percentage points after widening ...

Russian oil production declined in June, bringing the world's second-largest crude exporter closer to its first annual drop in output since 1998. Production fell to 9.77 million barrels a day (40 million metric tons a month), 1 percent less than in June last year, according to data released by CDU TEK, the dispatch center for the Energy Ministry. Compared with May, output was up 0.2 percent. There is increasing speculation that Russia's output may have peaked as producers struggle with ageing fields, rising costs and increasingly remote new deposits.