Central Bank of Armenia: Impact of possible gas price increase cannot yet be assessed
09.07.2026,
12:11
A possible increase in Russian gas prices remains one of the inflationary risks for Armenia, but its impact cannot yet be assessed due to the lack of specific parameters.
YEREVAN, July 9. /ARKA/. A possible increase in Russian gas prices remains one of the inflationary risks for Armenia, but its impact cannot yet be assessed due to the lack of specific parameters. Armen Ktoyan, a member of the Board of the Central Bank of Armenia, stated this in an interview with CivilNet.
"There are no hints or more specifics on this matter yet, so it is difficult to assess the impact. In any case, the Central Bank does not have any specific estimates, but this issue is under our monitoring, and we view it as a risk that could trigger upward inflation," Ktoyan said.
According to him, the scale of the potential inflationary effect will depend on changes in contractual obligations, possible price increases, and measures the government may take.
"As for energy resources, this naturally carries a counter-inflationary risk. But the extent to which this will materialize is difficult to say. "This depends on what changes will occur in contractual obligations, how much prices will rise, and what actions the government will take to counteract this," he noted.
Ktoyan emphasized that when assessing the potential impact on inflation, it is necessary to consider not only the price of Russian gas at the border, but also the tariff for end consumers in Armenia.
"Gas reaches consumers in Armenia at a price approximately twice the price usually quoted for border deliveries. Therefore, if we want to assess the impact on inflation, we need to understand the change in the final price for consumers," the Central Bank Council member said.
He also cited the example of the petroleum product market, where Armenia's dependence on Russian imports has decreased in recent years thanks to supply diversification.
"Comparing the first five months of this year with the same period last year, Russia's share of gasoline and diesel fuel imports has decreased significantly. Deeper diversification has made it possible to avoid any undesirable price effects that could have arisen," Ktoyan said.
He also noted that the situation with natural gas differs from the oil product market, as the ability to quickly change the supply structure in this case is significantly more limited.
Responding to a question about whether the Armenian economy could withstand a possible sharp rise in gas prices for end consumers, Ktoyan stated that such scenarios are difficult to assess without specific initial data.
"You're talking about a specific scenario. I find it difficult to assess its impact in terms of the economy's ability to absorb such a shock. Moreover, the government can use various support instruments to increase this capacity—the only question is whether and to what extent subsidies will be provided," he said.
Ktoyan also noted that Armenia's Russian direction is associated with more than just inflation risks.
"I would like to remind you that the Russian direction poses not only the risks of increasing inflation but also the risks of containing it. These risks can manifest themselves differently in different situations," the Central Bank Council member stated.
On Gas Prices
On April 1, Russian President Vladimir Putin, at a meeting with Armenian Prime Minister Nikol Pashinyan in Moscow, stated that Russian gas is cheaper for Armenia than gas in Europe. He stated that gas prices in Europe exceed $600 per thousand cubic meters, while Russia sells gas to Armenia at $177.5 per thousand cubic meters.
On April 9, commenting on the possible increase in the price of Russian natural gas for Armenia, Pashinyan stated that long-term contracts exist between Armenia and Russia and will not be violated.
Earlier, Russia notified Armenia of the possible suspension or denunciation of the 2013 agreement on the supply of gas, petroleum products, and rough diamonds if Armenia's EU accession process proceeds.
"There are no hints or more specifics on this matter yet, so it is difficult to assess the impact. In any case, the Central Bank does not have any specific estimates, but this issue is under our monitoring, and we view it as a risk that could trigger upward inflation," Ktoyan said.
According to him, the scale of the potential inflationary effect will depend on changes in contractual obligations, possible price increases, and measures the government may take.
"As for energy resources, this naturally carries a counter-inflationary risk. But the extent to which this will materialize is difficult to say. "This depends on what changes will occur in contractual obligations, how much prices will rise, and what actions the government will take to counteract this," he noted.
Ktoyan emphasized that when assessing the potential impact on inflation, it is necessary to consider not only the price of Russian gas at the border, but also the tariff for end consumers in Armenia.
"Gas reaches consumers in Armenia at a price approximately twice the price usually quoted for border deliveries. Therefore, if we want to assess the impact on inflation, we need to understand the change in the final price for consumers," the Central Bank Council member said.
He also cited the example of the petroleum product market, where Armenia's dependence on Russian imports has decreased in recent years thanks to supply diversification.
"Comparing the first five months of this year with the same period last year, Russia's share of gasoline and diesel fuel imports has decreased significantly. Deeper diversification has made it possible to avoid any undesirable price effects that could have arisen," Ktoyan said.
He also noted that the situation with natural gas differs from the oil product market, as the ability to quickly change the supply structure in this case is significantly more limited.
Responding to a question about whether the Armenian economy could withstand a possible sharp rise in gas prices for end consumers, Ktoyan stated that such scenarios are difficult to assess without specific initial data.
"You're talking about a specific scenario. I find it difficult to assess its impact in terms of the economy's ability to absorb such a shock. Moreover, the government can use various support instruments to increase this capacity—the only question is whether and to what extent subsidies will be provided," he said.
Ktoyan also noted that Armenia's Russian direction is associated with more than just inflation risks.
"I would like to remind you that the Russian direction poses not only the risks of increasing inflation but also the risks of containing it. These risks can manifest themselves differently in different situations," the Central Bank Council member stated.
On Gas Prices
On April 1, Russian President Vladimir Putin, at a meeting with Armenian Prime Minister Nikol Pashinyan in Moscow, stated that Russian gas is cheaper for Armenia than gas in Europe. He stated that gas prices in Europe exceed $600 per thousand cubic meters, while Russia sells gas to Armenia at $177.5 per thousand cubic meters.
On April 9, commenting on the possible increase in the price of Russian natural gas for Armenia, Pashinyan stated that long-term contracts exist between Armenia and Russia and will not be violated.
Earlier, Russia notified Armenia of the possible suspension or denunciation of the 2013 agreement on the supply of gas, petroleum products, and rough diamonds if Armenia's EU accession process proceeds.
