"We can live without Russian gas," Aliyev told government ministers at a meeting shown on national television. He ordered Azerbaijan's state oil and gas company to boost gas output.

Azerbaijan, which controls giant Caspian oil and gas reserves, is unhappy with price rises for Russian gas. Gazprom says it wants countries in the former Soviet Union that receive subsidised gas to pay more competitive prices.

Gazprom has offered to supply Azerbaijan with gas at $235 per 1,000 cubic metres.

"These prices are unfounded. Other countries in the CIS get gas at prices considerably cheaper than those offered to Azerbaijan," Aliyev said, referring to the Commonwealth of Independent States (CIS).

Azerbaijan bought about 4.5 billion cubic metres from Gazprom at $110 per 1,000 cubic metres in 2006, down from 4.6 billion cubic metres at $60 in 2005.

"It is now the end of January but we feel the absence of those 4.5 billon cubic metres which Gazprom used give us," Aliyev said.

Aliyev said additional gas would come from the Shakh Deniz field, operated by BP Plc and Norway's Statoil, and the giant BP-led Azeri-Chirag-Guneshli project. Reuters