Russia Halts Gas Exports to Europe Via Ukraine

Russia stopped exporting gas to Europe via pipelines through Ukraine on January 1, marking the end of a five-year transit deal between Russia and Ukraine.

The deal, signed in 2019, allowed Russia to export liquefied natural gas to Europe through Soviet-era pipelines running through Ukraine. It is Russia’s oldest gas route to Europe, and it made up roughly half of Russia’s total pipeline gas exports to Europe last year.

Resistance: Since the outbreak of the Russia-Ukraine war, Ukraine has insisted it would not renegotiate the deal. Ending the deal means Ukraine will lose roughly $800 million in transit fees each year and Russian energy giant Gazprom will lose approximately $5 billion in gas sales.

“We stopped the transit of Russian gas. This is a historic event,” Ukrainian Energy Minister German Galushchenko said. “Russia is losing its markets. It will suffer financial losses. Europe has already made the decision to abandon Russian gas.”

Russia now has only one remaining gas export route to Europe: the TurkStream pipeline at the bottom of the Black Sea.

What now? While Europe has been bracing for the shutdown of the pipeline by shifting toward alternative gas suppliers, some regions of Europe are still heavily dependent on Russia.

Moldova said it will have to reduce its gas use by a third due to the pipeline’s closure. Slovak Prime Minister Robert Fico said the closure will have a “drastic impact” on all European nations.

The expiration of the Russia-Ukraine deal could force Europe to begin searching for more alternative supply routes or pressure it into negotiating its own direct supply deal with Russia, such as it tried doing with the Nord Stream pipelines.

The creation and destruction of the Nord Stream exposed the frightening connection between Europe, particularly Germany, and Russia.

Learn more: Read “Nord Stream Pipeline Sabotage.”