Bulgarian state-owned gas supplier Bulgargaz proposed to the Bulgarian Commission for Energy and Water Regulation (KEVR) that the price of natural gas for October 2020 should be about 12.7 euros/MWh, excluding VAT and excise duty. The company proposed an increase in wholesale natural gas price of 10.5 % for October. The company It also said that it plans to propose 5.7 % price hike for November. However, despite recent price hikes, it will still be significantly lower compared to November 2019, when it amounted to around 19.4 euros/MWh. Previously, KEVR has approved a 20.3 % increase of wholesale natural gas price for September, following the inspection performed by the Ministry of Energy. Initially, Bulgargaz proposed 15.21 % gas price hike for September, but the figure rose to 20.3 % at the last minute, which prompted termination of the process and the aforementioned inspection. Bulgargaz argued that the reason for sudden price increase is the adjustment with trends on European exchanges observed in late August.
In early March, Bulgargaz and Russian Gazprom Export have finalized an agreement on 40.3 % reduction of the price at which Russia supplies natural gas to Bulgaria, backdated to 5 August 2019. Bulgaria was the last of eight EU Member States of Eastern Europe to strike a deal on a price cut with Gazprom, in the wake of a settlement reached between the European Commission and the Russian monopolist on an anti-trust investigation. According to recent change in regulation, the price of natural gas in Bulgaria is determined once a month, instead of previous method which included gas price adjustments once a quarter, and is also approved by the Commission for Energy and Water Commission (KEVR). A new hybrid formula will now be used, in which the European gas hubs will heavily outweigh oil market fluctuations. The proposed price cut takes into account prices on the European gas markets and the dollar rate. So far, the price of the Russian natural gas for Bulgaria was calculated on the basis of the oil prices for the last six months. Bulgaria covers all its gas needs via Russian imports.
