The halt to the transit of Russian gas through Ukraine has raised fears of supply shortages and a surge in energy prices, particularly in landlocked European countries such as Slovakia. Ukraine and Russia both announced the shutdown on Wednesday, prompting some European Union (EU) countries to resort to more expensive alternative energy sources.
VALLETTA, Jan. 2 (Xinhua) — The halt to the transit of Russian gas through Ukraine has raised fears of supply shortages and a surge in energy prices, particularly in landlocked European countries such as Slovakia. Ukraine and Russia both announced the shutdown on Wednesday, prompting some European Union (EU) countries to resort to more expensive alternative energy sources.
“IT WILL HARM THE EU, NOT RUSSIA”
Slovak Prime Minister Robert Fico said on Wednesday that stopping gas transit to Europe via Ukraine would have “serious consequences for all of us in the European Union, without harming Russia.”
This interruption follows Ukraine's decision not to renew the gas transit agreement concluded in 2019 between its state-owned company Naftogaz and the Russian company Gazprom, which expired on December 31, 2024.
“At 07:00 (05:00 GMT), in the interests of national security, the transportation of Russian natural gas through the territory of Ukraine was interrupted,” Ukraine’s Energy Ministry said in a statement on Wednesday. Similarly, Gazprom confirmed that it had cut off gas supplies due to the expiration of key agreements and Ukraine's refusal to renew them.
In a letter to the European Commission on Sunday, Fico condemned the halt to Ukraine's gas transit as irrational and warned it would escalate tensions and harm the EU more than ever. 'to Russia. He also indicated that his government could consider measures such as suspending electricity supplies to Ukraine.
Slovakia, which relies heavily on Russian gas, is among the most affected countries. It imports around three billion cubic meters of natural gas from Russia via Ukraine each year, representing two-thirds of its demand.
However, the European Commission played down the potential impact, with a spokesperson saying that Europe's gas infrastructure was “flexible enough” to supply gas of non-Russian origin to central and eastern Europe via alternative routes. , and that it had been reinforced by new import capacities for liquefied natural gas (LNG) from 2022.
Mark Cigoj, editor-in-chief of Croatian weekly 7 Dnevno, noted that Slovakia, Austria and Hungary were particularly vulnerable, given their dependence on Russian gas and lack of direct access to LNG imports.
SUPPLY, PRICE TENSIONS
Slovakia's Network Industries Regulatory Authority, the country's energy regulator, has forecast an increase in gas prices for households by 15% to 34% in 2025 without state energy aid.
To mitigate the impact, the Slovak government has allocated around 235 million euros for energy aid, putting an even greater strain on the country's already tight budget.
SPP, Slovakia's state-owned gas distribution company, assured continuity of supply on Wednesday, while acknowledging the rising costs of alternatives.
-Moldova, which imports around two billion cubic meters of gas a year from Russia via Ukraine, adopted measures on Wednesday aimed at reducing electricity consumption by at least 30%.
These measures include limiting public lighting, stopping escalators in some public and commercial buildings and changing working hours in sectors with high energy consumption.
In 2023, around 15 billion cubic meters of Russian gas were transported to Europe via Ukraine, representing around 5% of Europe's needs. After the cessation of Ukrainian transit, the TurkStream gas pipeline, which passes under the Black Sea, becomes the only route for transporting Russian gas to Europe.
According to the European Commission, the share of Russian pipeline gas in EU imports fell from more than 40% in 2021 to around 8% in 2023.
However, Mr Cigoj noted that the EU needed to develop a clear plan to coordinate gas purchases between member states, warning that increasing margins and transport costs would push up gas prices, fueling even more inflation.
CHANGE DRIVES COSTS TO CLIMB
While many European countries have significantly reduced their dependence on Russian gas since the start of the conflict between Russia and Ukraine, countries such as Slovakia, Hungary and Austria remain dependent on it.
Slovak Deputy Prime Minister and Minister of Economy Denisa Sakova said on Tuesday that Slovakia is technically well prepared for the cessation of gas deliveries, as the country has sufficient reserves and other sources of supply for the year 2025.
However, she warned of difficulties that could arise if the problem persists into next winter's heating season.
It is obvious that European countries will have to organize themselves to buy much more expensive gas from other sources in the future, concluded Mr. Cigoj.
Markus Krug, deputy director of the gas department at Austrian energy regulator E-Control, predicted that Russian gas would likely continue to pass through Turkey, thereby supplying Hungary. He estimated that Slovakia's gas supply could come mainly from Hungary, with the rest coming from Austria, the Czech Republic and Poland.
The TurkStream gas pipeline, with an annual capacity of 31.5 billion cubic meters, has limited capacity to absorb the increase in demand. To make up the deficit, the EU will have to rely more on LNG imports, the cost of which is significantly higher.
