Ukraine and Russia Plan to Keep Gas Flowing as Fighting Rages

Russia and Ukraine intend to keep pipeline gas flowing to Europe even as fighting continues near a key cross-border transit point for the fuel.

Bloomberg
Published13 Aug 2024, 12:04 AM IST
Ukraine and Russia Plan to Keep Gas Flowing as Fighting Rages
Ukraine and Russia Plan to Keep Gas Flowing as Fighting Rages

Russia and Ukraine intend to keep pipeline gas flowing to Europe even as fighting continues near a key cross-border transit point for the fuel.

Both sides have no intention of halting flows via the Sudzha gas-intake station in Russia’s Kursk region, people with knowledge of the matter said, asking not to be identified due to the sensitivity of the information.

Ukraine’s biggest incursion into Russian territory since the Kremlin invaded its neighbor in 2022 has pushed European gas prices to the highest this year amid fears supplies will be disrupted. Yet both sides have a financial incentive to keep fuel flowing. For Kyiv, gas transit provides crucial funds for its war-torn economy — amounting to about $1 billion in 2021 — while Europe remains one of Russia’s largest customers for pipeline gas.

Ukraine is keen to be seen as a reliable partner to Europe in the hope the region’s traders will make more use of its vast gas storage facilities. And it has good reason to protect infrastructure since unused pipelines could become targets of military attacks or fall into disrepair, which would be costly to fix.

Yet any accidental damage to key infrastructure at the gas-intake station could halt supplies, one of the people said. The cross-border point has been under control of Ukrainian troops following the incursion, two people said.

Russian supplier Gazprom PJSC didn’t immediately respond to requests for comment. Ukraine’s Energy Ministry declined to comment.

“We intend to continue to provide gas transportation services within the framework of the agreement,” Ukraine’s Naftogaz said in a statement, referring to a gas transit deal that expires in December. 

While most of Europe has sought alternatives to Russian pipeline gas since the invasion of Ukraine, nations such as Austria, Slovakia and Moldova continue to import supplies from Gazprom via Ukraine. 

Gazprom continues to send gas to the Sudzha point, with daily flows stable within a range of 37 million cubic meters to almost 40 million cubic meters. 

While that’s slightly below the 42 million cubic meters a day sent in recent weeks — before Ukraine’s incursion — it reflects lower requests from European customers.

Russian flows via Ukraine are set to remain within the normal range on Tuesday, according to so-called nominations, or orders, published by the Ukrainian grid. Actual supplies may still change.

This article was generated from an automated news agency feed without modifications to text.

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First Published:13 Aug 2024, 12:04 AM IST
Business NewsNewsWorldUkraine and Russia Plan to Keep Gas Flowing as Fighting Rages

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