Freezing temperatures, combined with the shutdown of a key supply source: wholesale gas prices in Europe have been rising in recent days. On the Title Transfer Facility (TTF), the main European gas market, the megawatt hour has even exceeded 50 euros several times since December 31, its highest level since October 2023, compared to less than 30 euros at the same time last year. . In question, in addition to the cold wave on part of the continent which is pushing demand upward, the cessation on January 1, 2025 of deliveries of Russian gas through Ukraine to the European Union (EU), after the expiration of a transit contract between the two belligerent nations.
Despite almost three years of war, Russian gas had in fact continued to transit via a network of pipes on Ukrainian territory, and money to be paid by the belligerent to the invaded country as a transit fee. A unique but perfectly legal trade, the EU having never imposed sanctions on imports of Russian gas, unlike oil or coal. But with the contract established in 2019 between the giant Gazprom and the Ukrainian company Naftogaz ending on December 31, 2024, Ukraine was decided not to sign a new agreement, considering that the recipient European countries – Austria, Italy , Slovakia – had had time to diversify their supplies.
“Historical event”
If Vienna and Rome accepted the Ukrainian decision, Moscow and Bratislava did everything, until the last hours of 2024, to sustain the delivery of these 15 billion cubic meters of Russian gas per year to the EU. But Kyiv’s determination to put an end to a transit which brought in $6.5 billion per year to the Kremlin and directly financed its war against Ukraine put them in check.
Fifty years after the start of this flow between Russian gas fields and Europe via Ukraine, Kyiv has cut the pipes. “This is a historic event, applauded Ukrainian Energy Minister German Galushchenko in a press release. Russia is losing markets, it will suffer financial losses.” Ukrainian President Volodymyr Zelensky even mentioned January 1 on X “one of Moscow’s greatest defeats.” Recalling that between Vladimir Putin’s takeover more than 25 years ago and today, the annual volume of gas sent to Europe via Ukraine increased from more than 130 billion m³ to “zero”. “With its use of energy as a weapon, and the cynical blackmail exerted on its partners, Russia has lost one of the most profitable and geographically accessible markets,” pressed the Ukrainian president.
When Moscow invades Ukraine in February 2022, Europe depends on Russian gas for 40% of its supplies. By the end of 2024, this proportion had fallen to 15%, including around 5% via Ukrainian pipes. The rest, via the TurkStream gas pipeline, and by ship, in the form of liquefied natural gas (LNG).
“Blackmail”
“Our common task today is to support Moldova during the period of energy transformation,” however noted the Ukrainian president. Transnistria, supplied with Russian gas by Moscow since its creation in 1991, has no longer had access since January 1 to the fossil fuel which fueled its entire economy, and is exposed to shortages of electricity and heating. The breakaway Moldovan region received Russian gas via one of the pipelines running through Ukraine. Gazprom could have continued to supply it via TurkStream, but Moscow chose to use this interruption as a lever to put pressure on Moldova, which has been seeking to escape its influence for several years. The spokesperson for the Moldovan government also called on Russia to “stop his blackmail”.
At the same time, Zelensky called for “overcome the hysteria of certain European politicians who prefer mafia schemes with Moscow to a transparent energy policy”. A barely veiled reference to discussions led by pro-Russian Slovak Prime Minister Robert Fico with the Kremlin. Slovakia, very dependent on gas from Moscow, was until now also a transit country, bringing in up to 500 million euros per year. Bratislava had particularly pushed for an agreement with Azerbaijan, which does not have sufficient production capacity to cover European demand, but has a gas pipeline with Russia. Baku could thus have purchased Russian molecules before re-exporting them to the EU as Azeri gas. Of “Russian gas laundering”, described Anne-Sophie Corbeau, researcher at the Center on Global Energy Policy at Columbia University (New York), during an interview in December.
Stocks
In 2024, the EU received around 50 billion m³ of Russian gas via pipeline and in the form of LNG – including 15 billion m³ coming from Russia via Ukraine, “which will have to be compensated in one way or another”, remarked Anne-Sophie Corbeau. Europe could therefore have to depend even more on LNG, from the United States and… Russia, which exported record volumes in 2024 and rose to second position in the ranking of countries which supply the EU the most. LNG remains an expensive option for landlocked countries in Central and Eastern Europe which, in the absence of access to the coast, must pay the cost of delivery by sea, regasification and then transit.
The cessation of delivery via Ukraine comes at a time when European countries have already drawn heavily from their storage reservoirs, more than during the two previous winters. According to public databases, Croatia, France and the Netherlands have fallen below the 60% occupancy mark. And while Europe is unlikely to run out of gas this winter, it will be more difficult, and more expensive, to replenish these stocks by next winter.
