Top Russian gas firm Gazprom (GAZP.MM) expects its gas prices for Europe in long-term contracts to average $500 per thousand cubic metres by December, above planned levels, its chief executive told reporters.
Gas prices are linked to those of oil products and crude, which is trading above $120 per barrel, the highest level since 2008 due to political unrest in the Middle East and North Africa.
CEO Alexei Miller also said on Monday that April export gas volumes to Europe, which receives around a quarter of its gas supplies from Gazprom, will exceed those during "some winter months", when there is typically peak demand for the fuel.
"The European markets are beating all the records. For example, Gazprom's April export supplies will exceed those for some winter months, while for December we see our long-term contract prices at around $500. I think those will not be the last records we will witness this year," he said.
The company in February had planned for a gas price increase of around 15 percent for Europe in 2011 to $352 per thousand cubic metres on average, though analysts consider the figure too conservative. Its average European export price in the first quarter of the year was already $346 per thousand cubic metres.
Demand for gas in Europe is rising on the back of economic recovery. Meanwhile, Gazprom is also getting an upper hand due to the nuclear power crisis in Japan as European countries start backpedalling on nuclear energy development and look instead to increase gas in the energy mix.
The Russian company has also said that European demands for pricing concessions in long-term contracts have eased as spot prices have increased.