The Russian and Turkish governments have signed a retroactive agreement for a 10.25% discount on the Russian gas sold to Turkey, covering both 2015 and 2016, and state-run oil and gas companies Gazprom (Russia) and BOTAŞ (Turkey) agreed to end an arbitration dispute over the terms of gas supplies. As a result, Turkey will receive around US$1bn.
In 2015, the Turkish government asked for a discount on the price of the gas deliveries coming from Russia via the Blue Stream and the Western Line. Gazprom originally agreed on the discount in early 2016, but later unilaterally cancelled the 10.25% discount on natural gas, prompting Turkey to apply to the International Court of Arbitration to resolve the dispute.
Turkey is the second largest consumer of Russian gas after Germany and imports approximately 30 bcm/year from Russia via two pipelines, of which 10 bcm/year for the domestic private sector. Russia covered 53% of the Turkish total natural gas imports and 52% in 2017.
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