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Transformation of Pricing in the Gas Industry As a Way to Stimulate Russia's Economic Development

Author

Listed:
  • Alexey Makarov

    (Energy Research Institute of the Russian Academy of Sciences, Moscow, Russia)

  • Vyacheslav Kulagin

    (Energy Research Institute of the Russian Academy of Sciences, Moscow, Russia)

  • Anna Galkina

    (Energy Research Institute of the Russian Academy of Sciences, Moscow, Russia)

  • Tatyana Mitrova

    (Energy Research Institute of the Russian Academy of Sciences, Moscow, Russia)

Abstract

The article analyzes the current natural gas pricing system in Russia and suggests directions for its transformation, taking into account the situation in the economy and the energy sector. The methodology is based on the methods of system analysis using economic and mathematical optimization modeling of the energy sector and the economy. The authors show that the current gas pricing system in the country limits the development of competition, does not allow to increase the efficiency of economic sectors and to modernize the energy sector. Mechanisms of gas exchange trading, which were created in the country, do not reflect the state of the market. Under these conditions, it is necessary to implement a set of measures that will allow creating a transparent pricing system based on market principles and reflecting the real situation in the consuming sectors. The gas industry can become a tool to stimulate economic development. The increase in gas prices would allow to create conditions for modernization, leading to GDP growth due to the expansion of orders for the Russian industry from the energy and consuming sectors. At the same time, increased efficiency helps to contain the growth of consu­mer spending, while increased tax revenues from the gas industry would make it possible to avoid the growth of other taxes on consumers, which could be inevitable due to the expected decline in revenues from the oil industry. In parallel, objective conditions would be created for the development of inter-fuel competition, and the gas industry itself will become a more attractive segment for investment.

Suggested Citation

  • Alexey Makarov & Vyacheslav Kulagin & Anna Galkina & Tatyana Mitrova, 2019. "Transformation of Pricing in the Gas Industry As a Way to Stimulate Russia's Economic Development," HSE Economic Journal, National Research University Higher School of Economics, vol. 23(4), pages 562-584.
  • Handle: RePEc:hig:ecohse:2019:4:4
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    More about this item

    Keywords

    tax policy; pricing; gas; market; exchange trade; energy consumption; fuel and energy complex; economy;
    All these keywords.

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • D4 - Microeconomics - - Market Structure, Pricing, and Design
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • P18 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Energy; Environment

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