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Russian Gazprom can use the fighting near Sudzha as a reason to stop gas transit; what consequences will this have for the EU and Ukrainian markets?

The energy regulator has increased the attractiveness of Ukrainian gas storage facilities for European customers.

Russian Gazprom can use the fighting near Sudzha as a reason to stop gas transit; what consequences will this have for the EU and Ukrainian markets?

According to Reuters, there is a risk that Gazprom could use the fighting near the Sudzha gas station, through which Russian gas transits through Ukraine to EU countries, as a reason to stop gas supplies. As a result, Russia could lose about $4.5B in annual income.

Although the EU is aware of the end of the transit contract between Ukraine and Russia in 2025, an early termination of supply would shock the European market. Some Central European countries still depend on these volumes, especially Slovakia and Austria.

Ukraine is ready for zero transit. The former director of the Gas Transmission System Operator of Ukraine, Serhii Makogon, said that when transit stops in 2025, prices for gas transportation for both domestic and commercial consumers will increase from ₴0.2 to ₴0.6 per cubic meter. Therefore, the total price of gas will increase by no more than 3%.

 

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