ADVISER TO RUSSIA'S PRESIDENT: STATE MUST NOT REGULATE GAS PRICES

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MOSCOW, April 2, 2004. (RIA Novosti) -- The president's adviser Andrei Illarionov comes out for liberalizing the gas sector.

"Our proposal is that the prices of gas sooner or later be regulated by the market but not by the state," Mr. Illarionov told RIA Novosti on Friday.

He holds the view that the market of gas and its market price would appear, when gas "becomes torn off" from the pipe (gas transportation is separated from gas extraction). The president's adviser explained that technology of "tearing gas away from the pipe" creates prerequisites for formation of a real world market of gas and its market price.

"When this occurs it will be possible to say how much the prices in one or another country are underestimated or overestimated," Mr. Illarionov said and added that "there are no world prices on gas as long as no world market of gas exists.'

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