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Gazprom Threatens To Curb European Gas Flows Through Ukraine

Russia’s Gazprom said on Tuesday it could begin reducing natural gas supply to Europe via Ukraine as of next Monday after noticing that part of the volumes through Ukraine are not reaching Moldova.

Russia still sends some gas via pipelines to Europe, via one transit route through Ukraine and via TurkStream. Additional reduction in volumes would come just as temperatures in Europe dipped to seasonal or below-seasonal levels after warm October and early November allowed the EU to fill up its natural gas storage.

Now Gazprom says that it has noticed some of the gas intended for Moldova under a contract with the local gas firm is being diverted by Ukraine. If the imbalance in gas transit continues, Gazprom will start reducing gas flows via Ukraine on the morning of November 28, the Russian gas giant said today, as carried by Russian news agency TASS.

Europe’s benchmark gas prices rose by 2% after Gazprom’s announcement on Tuesday.

Europe is more or less prepared to face this winter with nearly full gas storage sites and a steady flow of LNG imports. Still, lower Russian gas supply – although Europe is preparing for this possibility – would deplete gas in storage levels more this winter.

The real concern about gas supply in Europe is for the winter after that, the top executives of Europe’s biggest oil and gas majors said just before the heating season began.    

Ahead of the 2023/2024 winter, the gap in gas supply in Europe will be much wider without Russian gas. Europe will not be importing much Russian gas - or none at all if Russia cuts off deliveries via the one link left operational via Ukraine and via TurkStream - compared to relatively stable imports from Russia in the first half of this year before Moscow started gradually cutting volumes via Nord Stream in June until shutting down the pipeline in early September.

By Tsvetana Paraskova for Oilprice.com

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