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Gas Prices Drop As Russia Restores Full Supplies to Customers

Posted on: Wednesday, 4 January 2006, 09:00 CST

Gas prices drop as Russia restores full supplies to customers

LONDON, Jan. 3 (Xinhua) -- Natural gas prices fell on Tuesday in electronic European trading as Russia was restoring full natural gas deliveries to its European customers.

In morning trade in Europe, natural gas prices dropped by 42.5 U.S. cents to 10.80 U.S. dollars on the New York Mercantile Exchange, with prices climbing to as high as 10.94 U.S. dollars before settling back.

According to the analysts, Russia's state-run gas giant Gazprom's efforts to restore gas flow had helped ease upward pressure on the prices.

Light, sweet crude oil for February delivery won 10 cents to 61.14 U.S. dollars a barrel.

Heating oil gained slightly to 1.7634 U.S. dollars a gallon (3.8 liters), while gasoline was 1.7230 U.S. dollars a gallon.

Germany's biggest gas importer, EON Ruhrgas, said on Tuesday that gas supplies from Russia to the country went back to normal.

"The pressure in the pipelines was back to normal as of this morning," an EON spokesman said.

Meanwhile, other European buyers of Gazprom's natural gas including Hungary, Austria and Slovakia, also reported resumption of normal flow after Gazprom increased shipments via Ukraine following a chorus of protest over its decision to cut off supplies to its neighbor on Sunday as Kiev rejected to meet its demands for a steep price increase.

The price dispute between Moscow and Kiev raised fears of gas shortage in European states as around one-fourth of Europe's gas comes from Russia.

Source: Xinhua News Agency - CEIS

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