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Russians, Qataris and Iranians met in Teheran on Tuesday to discuss setting up a natural gas cartel, similar to the oil-based Organization of Petroleum Exporting Countries (OPEC).The notion of a gas cartel was brought up in January 2007 by Iran's Supreme Leader Ayatollah Ali Khamenei, but it is now gaining momentum and may require just a few more meetings before an accord is finalized.Iran, Russia and Qatar account for nearly a third of the world's natural gas exporters.The European Union relies on Russia for a large part of its natural gas imports and is concerned that any such cartel will affect supply and prices.The EU expressed opposition to a gas cartel, saying energy should be sold in the free market.A strengthening of economic ties between Iran and Russia could also be a source of concern for the United States, which is spearheading efforts to isolate Teheran and pressure Iran into abandoning its controversial nuclear program.Russia already has several key contracts with Teheran, including its assistance in building the Bushehr nuclear power plant, which will reportedly be operational by early next year.Western powers fear Iran is secretly manufacturing nuclear weapons and the United States has not ruled out a military attack on Iran's nuclear facilities.As well as holding ample caches of natural gas, Iran also has large quantities of oil and has threatened to block the strategic Strait of Hurmuz if attacked, a move that could impede global oil supplies.Teheran insists its nuclear program is for the peaceful purposes of creating energy and upholds its right to possess nuclear technology.The problem with a gas cartel is the difficulty in setting a price globally, saidDr. Amit Mor, co-manager of Eco Energy, an Israeli energy and environmental consulting and investment firm.The main difference between oil and gas is transportation, he told The Media Line."Oil is an international commodity and you can transport oil through marine tankers, road tankers, trains, pipelines etc. Natural gas can only be transported via pipelines under high pressure or after being liquefied at minus165 degrees Celsius via special tankers to other destinations, and then re-gasifying them from the liquid state. This process is very costly," he explained.While oil is an international commodity, natural gas is not, and its price is set according to region and not globally, Mor said.Also, natural gas contracts are long-term, which makes it difficult to change the prices agreed upon on a short-term basis.By THE MEDIA LINE NEWS AGENCY
As in the days of Noah...
