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Russian energy giant Gazprom has said it will renegotiate its long term natural gas contracts, which have been undercut by spot market prices.
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"Long-term contracts remain an indispensable term of gas trade in continental Europe. However, Gazprom is ready to take consumers' opinion into account and pursue a flexible trade policy if the gap between contract and spot prices becomes significant," the company said in a statement, RIA Novosti reported.
"If one of the parties says that market conditions differ significantly from what was expected, the parties will then start negotiations on the revision of the contracted price," Gazprom said.
Gazprom said it was compelled to revisit long-term deals as the volume of undelivered gas already paid for was on track to reach 10 billion cubic meters this year, double the amount from a year ago.
Gazprom has already agreed to sell a percentage of its deliveries to E.ON Ruhrgas at spot market prices, but said supplies would be cut if E.ON Ruhrgas did not maintain a set volume of orders.