Bloomberg: Europe will hardly feel the end of Russian gas transit through Ukraine

Very soon, on December 31, the transit agreement between Ukraine and Russia will expire. However, as the head of the German energy company Uniper SE Michael Lewis notes, this will have little impact on the strengthened European gas market, although countries such as Austria and Slovakia still depend on fuel from the East.

At the Gastech conference in Houston, Lewis noted:

“A certain volume of gas will disappear from the market, but this has already been taken into account and reflected in prices. Overall, our position before winter is quite strong.”

Europe has stockpiled gas reserves earlier than usual ahead of the heating season. It now also gets stable supplies from Norway and increased imports of liquefied natural gas from producers such as the United States to offset the already reduced volumes still coming from Russia.

Uniper and Germany as a whole no longer buy gas from Russian state gas company Gazprom. Uniper was nationalized during the 2022 energy crisis in one of the largest corporate bailouts in German history. After Russia invaded Ukraine and cut gas exports to Europe, the company, which had previously been one of Gazprom's key customers, was forced to pay hundreds of millions of euros daily for alternative supplies, and could only do so with state support, writes Bloomberg.

In June, Uniper won more than 13 billion euros ($14 billion) in damages from an international arbitration court over Gazprom's failure to deliver gas from mid-2022. The company is considering all options to compensate for the losses incurred. Lewis notes:

“It's a complicated legal process. There are several challenges. It will take as long as it takes.”

When asked about alternatives to replacing the transit agreement, he replied that Uniper does not intend to buy Russian gas. Negotiations with Russia on possible peace agreements also do not look promising, since the war in Ukraine has been going on for three years:

“We have to see the war end before there can be any serious negotiations, an end to the war and a real restoration of relations between EU and Russia. It is very difficult to imagine what can be done.”

The EU receives only 15% of all the gas it consumes from Russia and is ready to completely abandon it in the near future, as planned.About this stated On September 11, EU Energy Commissioner Kadri Simson specified that the European Union currently imports three times less gas from Russia than before Russia's invasion of Ukraine. On August 19, EU gas storage facilities had already reached the 90% filling target ahead of winter – several weeks before the legislative deadline of November 1, the EU Commissioner said.

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