Tuesday 23 December 2008

'The time of cheap gas is coming to an end'

Russian premier Vladimir Putin sent shivers down the spines of Western consumers today with a chilling warning that gas bills are set to soar.

To ram home the point, he oversaw the setting up of a new international Opec-style 'cartel' of gas producers - unofficially led by Moscow - which critics fear will seek to fix output and prices paid by users.

'Costs of exploration, gas production and transportation are going up - it means the industry's development costs will skyrocket,' said Putin.

'The time of cheap energy resources, cheap gas is surely coming to an end.'

It was the second day in succession that the Kremlin hardman entered the fray in what Western diplomats increasingly see as a policy of 'gas imperialism', holding consumers to ransom because there are often no other available sources of cheaper energy.

On Monday, his government warned that gas supplies to Britain and the rest of Europe could be disrupted during the New Year as part of a battle by Moscow to force its neighbour Ukraine to pay off debts and accept a huge hike in prices for the future.

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