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for tough economic conditions under the nationwide lockdown imposed on January 8 to cope with the coronavirus pandemic,” Alexander Paraschiy of Concorde Capital said in a note.
“The biggest threat from the announced regulation is that it does not comply with Ukraine’s commitments to the IMF “to apply a market-based pricing scheme” for natural gas “without any ceiling.” Recall, earlier the IMF insisted that natural gas prices in Ukraine should be based on the import parity principle (EU hub price plus delivery costs to Ukraine).
“In this case however, analysts believe the IMF might not consider this regulation as a breach of Ukraine’s commitments. Firstly, it has been declared to be temporary, with the government characterizing it as a measure to support households during the lockdown period.
“Secondly, Ukraine's liberalized gas market could become recognized as inefficient since its introduction in 2H20, owing to large possibilities for manipulations from private traders. Such a regulation might temporarily limit the inefficiencies before they are removed in other way.
“Thirdly, the discussed earlier import parity principle for gas pricing in Ukraine does not look necessary any more, as Ukraine has accumulated enough natural gas in storage to avoid any imports for a couple of years. For instance, the current annual consumption of gas in Ukraine is below 29bcm, which can be covered by about 20bcm of domestic production and use of gas stockpiles (22.9bcm of natural gas that is currently in Ukraine’s underground storage).
“The key question, however, is who will pay for this cheap gas. The declared price, for instance, is below the price of UAH7,326/tcm paid by Naftogaz to Ukrnafta in the recent debt settlement deal, and below the price of UAH7,220/tcm at, which Naftogaz is selling gas to households in January. It looks like any additional losses from the government’s initiative (if any) will be laid on Naftogaz (NAFTO), which is the gas seller of last resort,” Paraschiy concluded.
2.6​ ​ECHR accepts Ukraine’s complaints against Russia
The European Court for Human Rights announced on January 14 that it ruled to accept the majority of Ukraine’s complaints filed against the Russian government for its violation of human rights in its illegal occupation and annexation of the Crimean peninsula.
It was the court’s first ruling on Ukraine’s complaints, having accepted 14 out of 17 filed, as reported by the eurointegration.com.ua news site. In particular, the court will review complaints of Russia’s inappropriate lack of investigating murder, the persecution of non-Russian language mass media and restrictions on non-Russian language education, the intimidation and persecution of religious leaders, the automatic granting of Russian citizenship to residents, and the restriction of free movement to the Ukrainian mainland, among others.
In a separate ruling, the court determined that Russia had achieved effective control of the Crimea peninsula already on February 27, 2014, when Russian armed forces took effective control of its parliament. That was prior to the illegal political and legal actions securing the annexation, including the March 16, 2014 referendum. “On the night of February 27, the legitimate civilian
13​ UKRAINE Country Report​ February 2021 ​ ​www.intellinews.com