Russia provides Turkey with retroactive 10.25% discount on gas

Anadolu news agency reports that Turkish President Recep Erdogan has announced that an agreement has been reached with Russia, according to which Moscow will retroactively provide a discount on gas delivered to Turkey in 2015 and 2016.

"After long discussions, an agreement was reached on a 10.25% discount on gas delivered in 2015 and 2016. The difference in payment for these two years, namely $1 billion, will be returned to Turkey," the President said.

Gazprom had canceled discounts on gas purchased by Turkish companies in early 2016. The reason for the cancellation of the discounts, according to representatives of the gas monopoly, was a general decline in energy prices.

Russia and Turkey reached an agreement on a 10.25% discount on current gas prices in February 2015. Russia linked the introduction of the discount with Turkey’s signature of an agreement on the construction of the new Turkish Stream pipeline along the bottom of the Black Sea. The Turkish Stream project replaced the failed South Stream project blocked by the European Union.

Gazprom completed the construction of the first portion of the Turkish Stream gas pipeline at the end of April. The launch of construction for the second portion of the Turkish Stream pipeline is planned for the third quarter of 2018.

  Russian gas, Turkey