Reports from the European Commission or major energy market analyses

Russia Halts Gas Supplies via Ukraine; EU Gas Prices Hit €50

Dec 31, 2024, 02:59 PM

Russia is set to halt natural gas supplies to Europe via Ukraine as the transit agreement between the two countries expires on December 31, 2024. Gazprom, Russia's state-owned energy company, reduced gas flows through Ukraine to 37.2 million cubic meters on the last day of the agreement, down from 42.4 million cubic meters, and Ukraine has hiked transit fees after Kyiv refused to extend the contract. Nominations for gas transit through the Sudzha station are set to zero starting January 1, 2025, indicating that deliveries will cease without a new deal. The cessation of gas transit through Ukraine ends nearly three years of continued gas flow despite the ongoing war between the two nations, marking the almost complete loss of Russia's hold over the European gas market. European gas prices have risen slightly in anticipation of the halt, reaching the highest level in more than a year at €50 per megawatt-hour. European Commission spokesperson Anna-Kaisa Itkonen stated that the EU is prepared for the end of Russian gas transit via Ukraine, citing sufficient flexibility in infrastructure and alternative supplies, despite concerns from countries like Slovakia over supply security.