Georgia Will Not Pay Russian Prices

November 14, 2006

Georgian President Mikhail Saakashvili has said that Georgia will not buy Russian gas at $230 per 1,000 cubic metres. Georgian officials have said alternative partners will be sought, like Azerbaijan and Iran. But it remains unclear whether that will be a cheaper alternative to Gazprom (Russia’s gas company).

Georgia is upset that it is receiving an elevated price compared to some of its neighbors, who buy the gas at friendly Russian rates. In fact, Georgia is so desperate for cheaper Russian gas that it has begun scaring European leaders about potential politically-motivated Russian gas hikes. The Georgian President spoke about normalizing relations with Russia and avoiding irreparable damage between the two states. This is yet another signal by the Georgian side, that it needs Russia’s cooperation and that the economic sanctions against the country have indeed been effective. At the same time that Georgia seeks a rapprochement, it continues a provocative discourse regarding South Ossetia, claiming that the referendum held in the breakaway region is illegitimate. This Sunday, residents of South Ossetia voted in favor

Russia announced the gas hike following a Georgian-insinuated diplomatic scandal, which had four Russian officers arrested by Georgian officials.

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