Ukraine Halts Russian Gas Transit; European Gas Prices Surge Above €50 per MWh

Jan 2, 2025, 06:24 PM

Ukraine has halted the transit of Russian gas to Europe following the expiration of a five-year Gazprom contract, ending decades of gas supplies via Ukraine. This cessation has led to a 25% increase in European natural gas prices over two weeks, exceeding €50 per megawatt-hour—the highest level since October 2023. Russian Foreign Ministry spokeswoman Maria Zakharova stated that the disruption weakens Europe's economic potential and has a profoundly negative effect on living standards. Russia has accused the United States, certain European authorities, and Kyiv of being responsible for the halt, claiming that the U.S. is the main beneficiary. The halt has particularly impacted Moldova and the breakaway region of Transnistria, where industrial facilities have shut down due to a lack of energy resources, leading to heating shortages amid a cold snap. Slovakia's Prime Minister Robert Fico criticized Ukrainian President Volodymyr Zelensky for damaging EU finances by halting the gas transit, suggesting discussions on terminating energy supplies to Ukraine.