Gas prices are on the rise again at the start of 2025 in Europe. The reason: a stoppage of Gazprom deliveries to Europe. The Russian giant has not renewed its transport contract to Europe.
Gas prices will rise
Gas prices in Europe have seen a notable increase since the cessation of Gazprom deliveries via Ukraine. A logical situation in a context of war between kyiv and Moscow. This shutdown, which occurred at the beginning of January 2025, marks the end of decades of transit of Russian gas through Ukrainian territory. kyiv did not renew the transit agreement, citing national security reasons.
Since this interruption, the European market has seen the price of Dutch TTF, the main indicator of natural gas in Europe, jump by more than 4% to 51 euros per megawatt hour, a peak that had not been reached since October 2023.
This increase was accentuated by freezing temperatures in northern Europe, coupled with reduced gas stocks. They are currently only at 75% of their capacity. This level is significantly lower than in previous years, raising concerns about winter supplies. According to Gas Infrastructure Europe, reserves fell by almost 19% between September and mid-December, a particularly high rate of destocking.
This drop in storage capacity is all the more worrying as the cessation of deliveries via Ukraine represents around 5% of the European Union’s total natural gas imports. For countries like Hungary and Slovakia, which were heavily dependent on this route to meet around 65% of their demand in 2023, the loss of this source of supply constitutes a real problem. Alternatives, notably gas from TurkStream or other routes such as the Trans-Balkan route, remain insufficient to compensate for this loss.
Big consequences
The cessation of deliveries via Ukraine is not just an energy issue, it also constitutes a symbolic setback for Moscow. As Ukrainian President Volodymyr Zelensky pointed out, this ruling marks “one of Moscow’s biggest defeats” in the energy sector. Indeed, 25 years ago, Russia exported more than 130 billion cubic meters of gas per year via Ukraine, a volume now reduced to zero. In fact, this should further weigh on its economy.
However, this disruption is taking a heavy toll on Central Europe, where governments are being forced to take emergency measures. In Slovakia, for example, Prime Minister Robert Fico has warned of a “drastic impact” on the entire European Union and has just begun talks with Moscow to try to secure an alternative supply.
Meanwhile, the European Commission is proposing various solutions to alleviate this crisis, in particular by promoting importing gas from Greece, Turkey and Romania, but these solutions require time and suitable infrastructure. However, this situation could result in significant price volatility and therefore potential increases for French households.
A reaction? Leave a comment
Did you like this article? Subscribe to our free newsletter for engaging articles, exclusive content and the latest news.
