One of the significant changes in the economy in recent months has been the sharp decline in gas exports to Russia. For the past three years rising prices and volumes of gas sales to Russia led to a considerable natural resources windfall. Unexplained factors have led to a cut in gas exports to Russia during 2011. Official statistics put exports of energy and fuel products-which overwhelmingly comprise sales of gas-at US$708m in the first quarter of 2011, still accounting for one-fifth of total exports, but a fall of 10% in value terms compared with the year-earlier period. Although no information is available on the price at which Uzbekistan sells gas to Russia, the fact that the country is following Russia's own stance of selling gas at a price model that follows global oil prices suggests higher prices than agreed in 2010. Uzbekistan has raised the price of gas sold to Tajikistan by around 9% compared with end-2010, although it has agreed a small discount with the Kyrgyz Republic, largely in the interests of maintaining stability in that country, which suffered an economic downturn in 2010 as a consequence of political unrest and inter-ethnic violence. It therefore seems clear that gas export volumes are falling significantly more rapidly than the decline in value terms.

The Uzbek government has made no comment on the phenomenon. However, Sergei Ivanov, a Russian deputy prime minister, announced at the end of May that Gazprom, the Russian state-controlled gas monopoly, had only bought 1.6bn cu metres of gas from Uzbekistan. Although Mr Ivanov did not specify the timeframe, he was probably referring to the first five months of the year. If Mr Ivanov's figure is correct, this is a cut in expected exports of around 70%, given that Gazprom had originally agreed to buy at least 13.5bn cu metres of gas from Uzbekistan in 2011. The reason for the lower export volume is unclear. Gazprom has also transported less Turkmen gas through Uzbekistan than expected, purchasing just 2.7bn cu metres in January-May out of an annual target of 11bn cu metres, around 40% below target.