With Ukraine Gas Transit Cut, TurkStream Remains Europe's Last Russian Corridor

The termination of Russian natural gas transit through Ukraine marks a significant shift in Europe's energy landscape. The agreement, which had been in place since 2019, expired at midnight on December 31, 2024, with Ukrainian President Volodymyr Zelensky announcing that it would not be renewed. This decision follows months of warnings from Zelensky, particularly as the deal was made prior to Russia's invasion of Ukraine but after its annexation of Crimea. The Urengoy-Pomary-Uzhhorod pipeline, which had been operational since the Soviet era, was Russia's last remaining major gas route to Europe after the Nord Stream sabotage and the cessation of gas transport through Belarus.

The closure of the pipeline has strategic implications for both Ukraine and Europe. While Ukrainian and Western officials aim to diminish Russia's ability to finance its military actions and use energy as a political tool, experts predict the suspension could cost Russia approximately 6.5 billion dollars annually. However, the shutdown does not come without risks for Ukraine, as military analysts warn that Russia could target Ukraine's remaining gas infrastructure with bombings. Despite these threats, the expiration of the agreement had been anticipated, and European nations have had time to adapt. The New York Times suggests that, although Ukraine's gas transit provided only around 5% of Europe's imports last year, disruptions could still exert pressure on the gas sector. Nevertheless, Europe has already managed to reduce its dependency on Russian energy significantly.

As of 2021, Russia provided over 40% of the European Union's gas imports, a share that has since dropped to under 15%. The EU has responded by diversifying its energy sources, including increased supplies from Norway, Azerbaijan, and Algeria. The European Commission reported that gas storage facilities were 95% full by October 2024, and demand has dropped by 18% compared to 2022. Liquefied natural gas (LNG) terminals, particularly in Germany, have also been ramped up, facilitating imports from the United States and Qatar. In 2023, Norway emerged as the largest supplier, providing around 30% of the EU’s gas, with the US contributing 19%.

However, some countries in Eastern Europe remain reliant on Russian energy. Slovakia, Hungary, and Austria continue to receive gas through the TurkStream pipeline, which runs through Bulgaria. Leaders from Slovakia and Hungary, both of whom are seen as sympathetic to Russia, have criticized Ukraine's decision to halt Russian gas transit. Slovakia, in particular, has projected losses of approximately 150 million euros due to increased tariffs, while Slovakian Prime Minister Robert Fico has threatened to cut off electricity supplies to Ukraine in retaliation.

In Moldova's breakaway region of Transnistria, the gas shortage is leading to significant energy challenges. Local authorities announced the cessation of hot water and heating supplies, citing a gas shortage. Moldovan national security adviser Stanislav Secrieru suggested that Russia was deliberately provoking this crisis to destabilize Moldova and influence the country's political direction ahead of elections. Despite Moldova's support for Ukraine, the situation in Transnistria, where Russian troops are stationed, remains a significant obstacle to the country's European Union aspirations.

Moscow, for its part, has blamed the United States, the European Union, and Ukraine for the termination of the gas transit agreement. Russian Foreign Ministry spokeswoman Maria Zakharova asserted that Gazprom had fulfilled its contractual obligations, and she warned that the end of gas supplies through Ukraine would negatively impact Europe's economy and living standards.

Sources:

• The New York Times
• BTA (Bulgarian News Agency)
• The Wall Street Journal
• The Guardian
• Politico
• TASS