Domestic gas consumption down 15% y-o-y in August and 8% in 8M12

Dragon Capital comments on the news: Domestic gas consumption totaled 2.1 bcm in August (-15% y-o-y and +6% m-o-m) as industrial consumers cut gas use by 18% y-o-y to 1.4 bcm. Demand from metallurgical producers shrank by 35% y-o-y to 0.3 bcm on the back of declining output (steel production was down 13% y-o-y in August) and substitution with coke and coal. Gas transit volumes were down 12% y-o-y to 5.6 bcm last month. Ukraine imported 2.7 bcm of gas in August (+45% y-o-y) and pumped 2.4 bcm (+111% y-o-y) into underground storage facilities, increasing total storage volume to 17.2 bcm (down from 19.2 bcm a year ago).

In 8M12, domestic gas consumption declined by 8% y-o-y to 35.6 bcm, with industrials reporting the largest drop in absolute terms (-10% y-o-y to 15.6 bcm). Households and municipal heating companies reduced consumption by only 1% and 2% y-o-y to 11.6 bcm and 5.9 bcm, respectively. Technical losses narrowed by 29% y-o-y to 2.5 bcm in 8M12 as gas transit volumes fell by 22% y-o-y to 56.2 bcm over the period.

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