Russian gas exports to Europe via Ukraine halted as transit deal expires

Moscow: So, it looks like Russian gas exports to Europe via Ukraine have come to a halt. This all happened right at the start of the New Year when the transit deal expired. It’s a pretty big deal, especially since Russia and Ukraine couldn’t come to any agreement to keep things flowing.

This shutdown marks the end of a long and rocky relationship that started back when Russia took Crimea back in 2014. After that, Ukraine stopped buying gas from Russia altogether. Ukraine’s Energy Minister even called this a historic moment, saying Russia is losing its markets and will face financial hits. Europe has pretty much decided to move on from Russian gas.

With the ongoing war, it was expected that gas flows would stop. Ukraine has been firm about not extending the deal while the conflict continues. Gazprom, the Russian gas giant, had already figured that they wouldn’t be able to send gas through Ukraine, which used to be about half of their total exports to Europe.

Now, Russia still has the TurkStream pipeline, which runs under the Black Sea, but that’s not enough to make up for the loss. The EU has been working hard to find other energy sources since the war kicked off in 2022, and countries like Slovakia and Austria have already lined up alternative supplies.

Moldova, which used to be part of the Soviet Union, is feeling the pinch too. They’re saying they’ll need to cut their gas use by a third now. It’s a tough situation all around, and there hasn’t been any immediate response from Europe yet.

The five-year transit deal officially expired on January 1, and Gazprom stated that they couldn’t supply gas through Ukraine anymore due to Ukraine’s refusal to renew the agreement. They announced that as of 8 AM Moscow time, the gas supply for transit through Ukraine has stopped.

Ukraine’s energy ministry also mentioned that halting the gas transport was in the interest of national security. This means Ukraine will lose about $800 million a year in transit fees, while Gazprom is looking at a loss of nearly $5 billion in gas sales.

Over the years, Russia built a significant share of the European gas market, but the war has really shaken things up. Other routes like the Yamal-Europe pipeline and the Nord Stream have also faced issues, further complicating the situation. Back in 2018, they delivered a record 201 billion cubic meters of gas to Europe, but that number has dropped significantly since then.