The Federal Antimonopoly Service of Russia supported an appeal by Russian oil firms to preserve duty free imports of Ukrainian pipes for oil and gas industry in 2010. The statement was related to the initiative of the Russian pipe makers to cut Ukrainian duty free imports by almost 2.5 times starting in 2010.
The oil firms said that the Russian oil and gas pipes market will be monopolized by three Russian pipe manufacturers, if the decision to cut duty free imports is approved by the Russian Government. We should remind the readers that delivery of Ukrainian pipes to Russia is regulated by an intergovernmental agreement, which restricts this kind of imports to no more than 5% of the Russian market per year. This agreement is valid through the end of 2009.
According to Millennium Capital analyst “The duty free quota in the amount of 427,000 tonnes per year applies to the Interpipe group only. But it is Novomoskovsk Pipe Plant that any extension of this agreement concerns, because the agreement relates specifically its particular assortment of pipes. This news would be undoubtedly estimated as POSITIVE for NVTR had the decision regarding this agreement been based on purely economic reasons. But now we have to take into account the political component of this decision, and, especially what it is that the Russian government may want in exchange. We think that the decision will be made after a meeting of the Russian and Ukrainian Prime Ministers in Yalta scheduled for November 19th 2009.”
(Sourced from Millennium Capital)
