“If the contract for the transit of Russian gas through Ukraine is not extended at the end of the year, the volume of gas supplies from Russia to the EU may be halved next year.”, — write: www.epravda.com.ua
If the contract for the transit of Russian gas through Ukraine is not extended at the end of the year, the volume of gas supplies from Russia to the EU may be halved next year.
This is reported by the Bloomberg agency with reference to the opinion of Bernstein analysts.
Before the Great War, Gazprom supplied more than a third of Europe’s gas needs, but since then the region has sought to diversify its supply sources.
The European Union now relies more on other sources, including Norway, North Africa and Azerbaijan, as well as liquefied natural gas from the global market.
Researchers do not expect an extension of the transit agreement beyond the end of this year, but in the event of an unexpected extension, it would lead to an additional 5 billion cubic meters of gas by the end of the heating season. This is less than the average monthly import volume in 2024, analysts noted.
In that case, prices for European gas futures would fall by only 1.4% compared to current levels during the winter months.
Gas prices in Europe have been very volatile this year as traders sought to hedge against a number of risks, including the termination of a gas transit agreement between Russia and Ukraine. Despite this, Europe managed to accumulate enough reserves and diversify its sources of fuel supply, which created more stable conditions for the winter.
A sudden increase in demand due to cold weather could affect the supply balance in Europe. The continuation of gas transit would help keep the market “more balanced” against the deficit that could arise without it this winter, analysts said.
Read also: Ukraine still pumps Russian gas and finances the war against itself. Will this continue in 2025?
We will remind:
The termination of the transit agreement between Russia and Ukraine on December 31 will have little effect on the strengthened European gas market
The Government of Ukraine is not conducting official negotiations regarding the continuation of the transit of Russian gas after the termination of the current agreement.
The President of Azerbaijan, Ilham Aliyev, expressed confidence in the outcome of the negotiations between Russia and Ukraine to ensure the continued supply of Russian gas through Ukraine to several European countries.
Ukraine does not intend to extend the gas transit agreement with Russia, which expires at the end of 2024, and is ready to discuss gas transit from other suppliers through its GTS if requested by Europe.