EU Heads for Financial Collapse over Russian Gas Stop Through Ukraine
By Gospa News Editorial Staff
Kiev’s refusal to extend a gas transit deal with Moscow has forced the Russian company Gazprom to stop gas transit at 8:00 a.m. Moscow time (5:00 a.m. GMT) on January 1, the company said in a statement.
“As Ukraine repeatedly and clearly refused to extend these agreements, Gazprom was deprived of the technical and legal ability to supply gas for transit through Ukraine from January 1, 2025. The supply of Russian gas for its transportation through Ukraine stopped at 8:00 a.m. Moscow time,” the statement reads.
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The company pointed out that its five-year gas transit agreements with Ukraine’s Naftogaz on cooperation between the operators of the Russian and Ukrainian gas transportation systems had expired on January 1.
The deal provided for the transit of 40 bln cubic meters of Russian gas through Ukraine annually. Russian President Vladimir Putin said earlier that there would definitely be no new contract for Russian gas transit because it’s not possible to make an agreement just days before the New Year. Kiev, in turn, announced plans to stop Russian gas transit.
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However, Ukraine is ready to resume gas transit based on a request from the European Commission as long as gas is not considered as “Russian,” while the Russian president pointed to the possibility of contracts with third parties, namely Turkish, Hungarian, Slovak and Azerbaijani companies.
Slovak Prime Minister Robert Fico expressed the most interest in continued Russian gas supplies. On December 22, Fico made a visit to Russia. He warned that the cost to the European Union could reach 120 billion euros in 2025-2026 from higher gas prices resulting from Ukraine’s move to end Russian gas transit.
Fico also said that Slovakia could take reciprocal measures against Ukraine, particularly halting back-up electricity supplies to Kiev.
Gas price in Europe rises to maximum in a year in anticipation of Ukrainian transit halt
Gas prices in Europe rose to their highest since November 27, 2023, $536 per 1,000 cubic meters during exchange trading, amid expectations that Russian gas transit through Ukraine will cease on January 1, according to data from the London ICE exchange on December, 31, 2024.
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The cost of February futures on the TTF hub in the Netherlands rose to more than $536 per 1,000 cubic meters, or 50 euros per MWh (based on the current exchange rate of euro to dollar, prices for ICE are presented in euros per MWh).
Since the beginning of the day the price has risen by more than 4%.
Central heating has been turned off in Transnistria due to the cessation of gas supplies
In Transnistria, central heating and hot water supply have been cut off in residential buildings and some institutions due to the cessation of gas supply. This was reported by the Tirasteploenergo company, which is responsible for the region’s heat supply. The company’s statement clarified that social facilities, such as hospitals with round-the-clock patient care, continue to receive heat.
According to local authorities, the situation is related to the limitation of gas supplies, which occurred due to unresolved problems with the region’s fuel supply. The Transnistrian leadership stressed that the closure is a temporary measure and that specialists are working to restore the gas supply. The authorities also promised to minimize the consequences for residents and social facilities.
The shutdown of heating in winter has caused concern among the population. Residents of the region are expressing concern on social networks about the further development of the situation, especially in view of the expected drop in temperature. At the same time, representatives of the Tirasteploenergo company assured that they are doing everything possible to resolve the issue as quickly as possible.
Gas supplies to Transnistria are directly related to supplies through the territory of Ukraine and Moldova. The region, which is virtually unrecognized at the international level, depends on external energy supplies, which makes it vulnerable to geopolitical and economic risks.
Difficulties in relations between Russia, Ukraine and Moldova add tension to the resolution of energy issues.
Experts emphasize that the crisis in the energy sector of Transnistria could worsen the socio-economic situation in the region. At the same time, the issue of energy security remains acute for the whole of Moldova, which also depends on gas imports and is forced to look for alternative energy sources.
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