European Commission energy reports or major energy news outlets

Ukraine Halts Russian Gas Transit from Jan 1; European Gas Prices Surge to €51/MWh

Jan 2, 2025, 04:51 AM

Ukraine has halted the transit of Russian natural gas to Europe through its territory after refusing to renew a key transit agreement with Gazprom that expired on December 31, 2024, citing 'national security' concerns, according to Ukraine's Energy Minister Herman Halushchenko. The cessation, effective January 1, 2025, marks the first time in nearly three years of Russia's invasion that Russian gas has stopped flowing through Ukraine to the European Union. The move affects several European countries, including Austria, Hungary, Slovakia, and Moldova, which rely on this supply. Moldova has already reported disruptions, with regions experiencing shortages of hot water and heating. European gas prices have risen in response, with Dutch TTF natural gas futures jumping over 3% to as high as €51 per megawatt-hour, the highest level since October 2023, amid concerns over potential supply shortages and increased competition for liquefied natural gas (LNG). The European Commission has sought to reassure member states, citing alternative supply routes and sufficient gas storage levels, but some countries are bracing for potential price increases of up to 30% in 2025. Turkey is being considered as a potential alternative transit route for Russian gas to Europe due to its strategic location and infrastructure. Russia has blamed Ukraine, the United States, and the European Union for the disruption, with Foreign Ministry spokeswoman Maria Zakharova stating that it weakens Europe's economic potential and negatively affects living standards.