Gazprom - Naftogaz Ukrainy Dispute: Business or Politics?




Case Details Case Introduction 1 Case Introduction 2 Case Excerpts

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Excerpts

Background

Gazprom, like many Russian companies, emerged out of the disintegration of the Soviet Union. Russia under its new President Boris Yeltsin privatized the state held monopoly departments and factories in order to embrace the market-oriented economic reforms and catch up with the West. Gazprom was one of them.

But whereas the oil industry was broken up into several fragments and privatized, Gazprom remained a monolith. In spite of its privatization, the state retained a significant stake in the company......

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Disputes with Ukraine

After the disintegration of the Soviet Union, Russia, the largest republic, became the successor state to the Soviet Union, inheriting all its obligations and entitlements. Russia was not willing to give up its influence over the former republics of the Soviet Union. It agreed to supply gas and oil, apart from various other things, to the former Soviet Union republics at a highly subsidized rate and under favorable terms..........

Elections in Ukraine

In the 2004 elections to the Ukrainian Presidency, Prime Minister Viktor Yanukovych (Yanukovych) and ex-Prime Minister Viktor Yushchenko (Yushchenko) were rival candidates. Prime Minister Yanukovych was supported by the outgoing President Leonid Kuchma and also by Russian President Vladimir Putin (Putin). Yanukovych favored closer and better ties with his big neighbor Russia..........


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