Sectors

Regions

Sections

Forecasts & Analysis

Market commentary

Reference & Archive

Supply & Demand

Precedent set in RWE-Gazprom contract ruling

Gazprom has lost an arbitration case against Germany utility RWE, meaning the Russian company must make further retroactive payments as its oil-indexed contracts come under more pressure Gazprom has lost an arbitration case against Germany utility RWE, meaning the Russian company must make further retroactive payments as its oil-indexed contracts come under more pressure.
By Jason Torquato and Tom Washington 28 June 2013 0 2597
Gazprom Chief Financial Officer Andrei Kruglov said profits could drop by 10% in 2013. (PA)

Germany’s second-largest utility RWE has claimed victory in its pursuit of a reorientation in the pricing mechanism of its long-term gas contracts with Russia’s Gazprom after the International Court of Arbitration ruled on Thursday.

Gazprom must now provide a rebate of its fees to RWE back to May 2010, although the Russian gas monopoly described the ruling as a compromise deal that did not reflect RWE’s initial demands for a “freefall” in price and “radical” formula revisions.

RWE said it will announce the financial implications of the...