Big Gas Exporters Blast Unilateral US Sanctions

Representatives of major energy-exporting nations on Friday said they oppose the use of unilateral sanctions on any of their members in a dig at the United States for its moves against Russia, Iran and Venezuela.

The Gas Exporting Countries Forum, which also includes members like Libya, Equatorial Guinea and Nigeria, expressed their “profound concern” about sanctions affecting the gas sector, which are not authorized by the United Nations, according to a communique signed by GECF’s 12 members after the group’s summit in Bolivia this week, Reuters reported.

The US Congress has imposed economic sanctions on a number of GECF members, including recent measures against Russia that-among other things-seek to prevent companies from participating in Russian pipeline projects. Russia is the world’s second biggest natural gas producer behind the US, which is not a GECF member, and depends heavily on its pipeline systems to reach its main customers in Europe.

Russian Energy Minister Alexander Novak said earlier on Friday that the United States should not be permitted to impose such sanctions without a vote of the United Nations Security Council, of which Russia is a member.

Washington also has imposed sanctions this year on Venezuela to pressure President Nicolas Maduro’s government and has threatened to reimpose some anti-Iran sanctions that were lifted as part of a 2015 deal to freeze its nuclear program.

US President Donald Trump has said Iran is violating the “spirit” of the 2015 deal.

The GECF communique on Friday said its membership would agree to cooperate toward a sustainable global natural gas market, while promoting the fuel’s use.

The meeting came as GECF members struggle with slumping global gas prices, blamed largely on surging supply from the US and elsewhere, that have reduced investment and returns in parts of the industry.

Novak said the oversupply on the world market could trigger a “crisis” drop in prices, similar to what occurred in the crude oil market. Gas prices already have plunged more than 80% in the past decade and remain under pressure due to growing supplies of shale gas and increased availability of liquefied natural gas that can be shipped overseas.

The US has been able to vastly increase its output of oil and gas in recent years, as improved drilling technology opened previously inaccessible reserves.

The GECF is modeled after the Organization of Petroleum Exporting Countries, whose 12 member nations manage oil supply to control prices. While GECF has called for increased cooperation to defend its gas market, it has not applied production limits as OPEC has done.

source: Financial Tribune