AZERBAIJAN: BAKU AND ANKARA IN GAS PRICING DISPUTE

Azerbaijan has accused Turkey of delaying Caspian Sea natural gas exports to Europe by insisting on a bargain-basement price for Azerbaijani gas. The remarks come at a critical time for Turkish-Azerbaijani relations, which have been unsettled by the thaw in relations between Turkey and long-time Azerbaijani foe Armenia.

Addressing his cabinet, Azerbaijani President Ilham Aliyev charged that Ankara is nickel-and-diming Baku for transit services. "It is not a secret that for several years now Azerbaijan has been supplying gas to Turkey for 30 percent of the market rates," the APA news agency on October 19 quoted Aliyev as saying. "Which country will be happy to sell its resources at 30 percent of the world market price?"

"We want to sell our gas if not at the world market price, at least for a price that is close to it," Aliyev continued. "Let this price not equal the price of the Russian gas, but at the very least it can be lower by eight to 10 percent, not by 50 percent."

Turkey is the key transit link for the US-backed Nabucco pipeline project that is meant to bypass Russia to bring Caspian gas to Europe. Instead of charging a transit fee, Turkey is offering to buy Azerbaijani gas, and sell it to its European neighbours.
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