At its pre-AGM meeting with investors, Gazprom management confirmed that the natural gas price for European customers will exceed $400/mcm in 2008, reflecting the recent boost in oil prices. That fueled speculations about similar price increases for FSU gas consumers, including Ukraine, which could see a more than 200% jump in the price of natural gas.
The uncertainty was enough to cause a resumed sell-off on the PFTS, with the biggest sales in the steel sector. Azovstal (-3.2%), Enakievo steel (-5.8%) and Alchevsk Steel (-4.4%) led the day in trading volumes. Among energy stocks, Zakhidenergo (-5.2%), Centrenergo (-4.3%) and Ukrnafta (-3.9%) were sold for liquidity reasons.
The lack of support for the market continued to stem from inflationary fears and growing political confrontation which could cause a delay in the ratification of vital economic documents such as the 2008 state budget and EURO-2012 related legislation.

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