Russia officially stopped supplying gas to Europe via Ukraine from January 1, 2025 when the five-year transit agreement between the two countries expired, marking the end of Moscow's dominance of the European gas market.
Gas pipeline in Boyarka village, Kiev, Ukraine - Photo: REUTERS
Russia stops supplying gas to Europe via Ukraine
Russia is allowed to transport gas to Europe through Ukraine under a deal signed in 2019. However, the five-year agreement expires today, January 1, 2025. Kiev does not want to extend it due to the current conflict with Moscow.
Data from Ukraine's gas transit unit shows that as of 17:00 GMT on December 31, 2024 (ie 0:00 on January 1, 2025 Vietnam time), Russia did not register any gas volume via gas pipelines on Ukrainian territory for January 1.
Analysts expect a negligible market impact from the halt in Russian gas flows through Ukraine, Reuters reported. The contract termination is unlikely to trigger a gas price crisis like the one in 2022, as the amount of gas affected is relatively small.
The European gas market showed little reaction on December 31, 2024. The European gas benchmark price settled at 48.50 euros/MWh.
The European Union (EU) has been working to reduce its dependence on Russian energy after the Russia-Ukraine conflict broke out in 2022.
The EU has found alternative supplies of liquefied natural gas (LNG) from Qatar and the US, and pipeline supplies from Norway.
This shift became more evident in 2023 when Russian gas producer Gazprom recorded a loss of about $7 billion - its first since 1999.
Some remaining customers that also buy Russian gas transited through Ukraine, such as Slovakia or Austria, have also arranged alternative supplies.
The EU is preparing by adopting energy efficiency measures, developing renewable energy and flexible gas systems, a European Commission spokesman said.
"Europe's gas infrastructure is flexible enough to supply non-Russian gas to Central and Eastern Europe via alternative routes. This infrastructure has been reinforced with significant new LNG import capacities from 2022," said spokeswoman Anna-Kaisa Itkonen.
Inevitable impact
Despite progress in finding alternative supplies from Russia, Europe is still feeling the impact as high energy costs reduce the competitiveness of its industry compared to the US and China.
This contributed to a severe economic recession, soaring inflation and worsening the cost of living crisis.
Ukraine will now face a loss of $800 million a year from transit fees from Russia, while Gazprom will lose nearly $5 billion in gas sales.
Russia and the former Soviet Union have built up a large share of the European gas market over half a century. However, the conflict with Ukraine has affected this activity.
In 2023, Russia will only transfer about 15 billion cubic meters of gas through Ukraine, down from 65 billion cubic meters when the five-year contract began in 2020.
Most of the Russian Federation's gas routes to Europe are now closed, including Yamal-Europe via Belarus and the Nord Stream pipeline under the Baltic Sea (destroyed in 2022).
Hungary and several other countries continue to receive Russian gas from the south via the TurkStream pipeline under the Black Sea.
Source: https://tuoitre.vn/ukraine-khoa-van-ky-nguyen-khi-dot-cua-nga-tai-chau-au-ket-thuc-20250101080325163.htm
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