Russia to Raise Domestic Gas Prices Average 18%

Russia's Federal Energy Commission has decided to raise domestic gas prices for industrial users by an average of 18 percent from January 20, local news agencies reported on Thursday. Russian domestic fuel prices, well below international prices for decades, have been rising this year, although many companies still depend largely on export revenues and have little market incentive to supply local consumers. Fuel price rises are a sensitive issue in Russia where many people, accustomed to Soviet-era welfare benefits such as cheap gas and electricity, are struggling to make ends meet and keep warm in the grips of winter. However, the news agencies said household gas prices would rise by 25 percent only from March 1. Domestic gas tariffs were last raised on May 1, 2000, by 20 percent for industry and 15 percent for households. The Federal Energy Commission decided earlier this week to raise wholesale electricity prices by 20 percent from January 1, reports.

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