(EnergyAsia, November 23 2012, Friday) — European resistance to oil-linked gas prices will drive Russia to seek Asian export partners, according to a report international business intelligence firm GlobalData.

It said Russia is being forced to re-evaluate its natural gas export strategy as the rest of Europe – the destination of 93% of the country’s gas exports in 2011 – is becoming disillusioned with the country’s pricing system.

Russia has long been dependent on Europe’s custom but that relationship is getting strained amid the decline in spot gas prices forcing many European utilities to take their business elsewhere.

Russia’s gas monopoly, Gazprom, has had to renegotiate its prices with some of the major European utility companies, agreeing to link 15% of export volumes to the spot market price in several deals.

The Russian firm has also offered price discounts of up to 10% to many of its customers including Italy’s Eni, Edison and Sinergie Italiane, France’s GDF Suez, Germany’s Wingas, Slovakia’s SPP and Austria’s EconGas, said GlobalData.

However, these discounts do relatively little to counter Russia’s exponential gas export price increase – from $244.44/million cubic meters (mcm) in July 2009 to $452.16/mcm in June 2012 – prompting European firms to escalate imports of liquefied natural gas (LNG) from producers in the Middle East and Africa.

Matthew Jurecky, GlobalData’s Director of Energy Research and Consulting, said:

“Weakened demand for natural gas during an economic crisis in the European Union has further lessened the region’s appetite for oil-price linked gas from Russia.

“Europe was already open to alternative sources after enduring the political games that have threatened supply over the past few years.”

As a hedge, Russia is aiming to raise natural gas exports to Asia.

GlobalData expects that to climb significantly from 11.8 billion cubic meters (bcm) in 2012 to 44.2 bcm by 2020, with China, Japan and South Korea being the main markets.