Russian gas deliveries through Ukraine finally ceased on January 1, approximately 1,042 days after Vladimir Putin launched his full-scale invasion. The end of gas deliveries through the Urengoy–Pomary–Uzhhorod pipeline came after Ukrainian President Volodymyr Zelensky refused to consider any possible expansion, including a high-profile gas exchange between Russia and Azerbaijan.
What is most remarkable about this decision is how little it impacted gas prices in Europe. It is, of course, less than two years since Europe suffered an energy crisis triggered by the collapse of Russian gas deliveries, the main driver of the inflation that followed. At the time, Putin used the energy weapon against the European Union by cutting off gas supplies through Nord Stream — before it was destroyed — and forcing a halt to deliveries through Ukraine’s other major pipeline. But the impact on gas prices of the latest cancellation has been relatively muted.
The disruption marks a major loss for Russia, with its gas giant Gazprom set to lose around $5 billion a year, or nearly 5% of its 2024 federal revenues from oil and gas sales. Yet there are also significant losers elsewhere in Europe. Hungary and Slovakia, in particular, stand to lose substantial supplies of the 15 billion cubic meters (bcm) of gas that flowed into Ukraine each year over the past two years. That the governments of these countries are the ones that have most supported the Kremlin’s position on the energy dispute — and called on Kyiv to accept Russian conditions to begin peace talks — is therefore not a surprise.
Swiss
