Concerns that Russia is trying to form a natural gas cartel along the lines of the Organisation of the Petroleum Exporting Countries may be misplaced, according to analysts and energy executives.

Despite the warning by Nato economists, it is far from certain that Moscow could persuade countries to join any such alliance. In many gas producing countries, the sector is far less-developed than their oil industries and needs greater input of foreign cash and expertise. Norway, Qatar, Nigeria, Trinidad and Tobago, Libya and even the much mooted Algeria would find it difficult to attract the huge sums of private-sector investment and know-how needed if the threat of future cutbacks under a cartel arrangement loomed.

If Russia managed to find participants, it would face considerable difficulty in creating a cartel along the lines of Opec because gas is traded very differently to oil. Gas is mainly priced on long-term contracts, often linked to the oil price. This makes manipulating prices by altering supply – in the way Opec does – far tougher.

Even for Moscow, playing such an adversarial game would be dangerous. Because domestic Russian prices are capped and Gazprom’s customers are at present only in Europe, the Russian monopoly is at least as reliant on Europe as Europe is on Russia.

Nevertheless, there is a way Russia and major gas producers could – and are – substantially influencing future prices.

The energy industry is more worried about Russia’s under-investment in the gas sector driving up prices than the possibility of a cartel doing so. If Moscow persuaded other countries to do the same, the problem would be compounded.

The International Energy Agency, the developed countries’ energy watchdog, in a recent report, said: “Another source of uncertainty concerns the possibility of major gas exporting countries co-ordinating their investment and production plans in order to avoid surplus capacity and to keep gas prices up.”

One industry analyst said: “In fact, we are witnessing some form of mutual agreement as Russia and Algeria restrain investment. Moscow has tightened the grip using Gazprom, and Algiers has just changed its hydrocarbons law, giving Sonatrach [the large Algerian state-owned energy group] 51 per cent of every project instead of 30 per cent.” Coupled with the shortage of labour and steel that is crippling gas projects across the world, these moves could seriously boost long-term prices.

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