In late November 2010, the Russian media quoted OAO Gazprom (Nasdaq: OZGPY; LSE: OGZD; DAX: GAZ; RTS: GAZP) executives as saying that the company was considering entering the Israeli market. One report said that Gazprom wanted to buy up to 50% of a private gas exploration company. Following the reports, executives of Israeli oil exploration companies held meetings with Gazprom executives in London and Moscow.
The big question is what Gazprom's objectives are. The main concern of Israel's energy executives is that Gazprom wants to block their ambitions to export natural gas to Europe. Gazprom is the world's largest natural gas company.
Other top global energy companies, such as Exxon Mobil Corporation (NYSE: XOM) and Royal Dutch Shell plc (NYSE: RDS; LSE: RDSA), still avoid the Israeli market, because of concerns about Arab reaction, but Gazprom is not worried about any boycott. It has a monopoly on Russia's natural gas transportation, and owns the world's largest natural gas reserves.
Gazprom's entry into the Israeli market has far-reaching political and strategic implications. It is not only a huge energy company; its top executives are also Russia's leaders. Russian President Dmitry Medvedev was Gazprom's CEO before taking up his new job.
Published by Globes [online], Israel business news - www.globes-online.com - on January 19, 2011
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