German natural gas importer Wingas GmbH Monday defended oil-indexed gas prices.
"On the import side the gas-oil price link is a good thing," Wingas Chief Executive Rainer Seele told reporters at the company's annual press conference in Frankfurt.
The oil price link "makes it easier for the producers to manage the funding of the necessary investments," Seele said.
The oil linked pricing mechanism for natural gas has in recent months been controversial. Critics say the sharp rise in crude oil prices has driven higher natural gas prices.
Seele added that Wingas has been experiencing "that the gas-oil price link offers clear advantages in many situations" particularly in light of the increasing global demand for energy. "It offers a high degree of supply security with calculable prices long-term," Seele said.
Wingas is a 50-50 joint-venture between BASF SE's (BAS.XE) oil and gas upstream unit Wintershall AG and Russian natural gas monopoly OAO Gazprom (GAZP.RS) and is Germany's second largest gas importer by volume.