Russian gas exports through the historic Soviet gas pipelines that cross Ukraine have ceased since January 1, ending decades of Moscow’s energy dominance over the European market.
The flow of gas, which had continued despite almost three years of war, ended at 05:00 GMT, according to the Russian company Gazprom, following Ukraine’s refusal to renew the transit agreement.
Impact on Europe and alternatives
The latest buyers of Russian gas in the EU, such as Slovakia and Austria, have already secured alternative supplies. On the other hand, Hungary will continue to receive Russian gas through the TurkStream gas pipeline, which crosses the Black Sea.
However, in Transnistria, a pro-Russian separatist region in Moldova, dependent on these traffic flows, heating and hot water supplies to homes have been cut.
The European Commission has assured that the bloc was prepared for this cut. “The European gas infrastructure is flexible enough to provide gas of non-Russian origin,” they assure and highlight the liquefied natural gas (LNG) import capacities developed since 2022.
A fading dependency
For half a century, Russia and the Soviet Union maintained a significant share of the European gas market, which peaked at 35%. However, since the start of the war in Ukraine, the EU has drastically reduced its dependence on Russian energy, purchasing more gas from Norway, Qatar and the United States.
Ukrainian Energy Minister German Galushchenko called the traffic cut a historic milestone. “We have stopped the transit of Russian gas. “Russia is losing its markets and will suffer significant financial losses,” he said in a statement.
Economic consequences for Ukraine and Russia
Ukraine will lose up to $1 billion a year in transit fees, which has led it to quadruple gas transmission rates for domestic consumers starting January 1. AND
For its part, Gazprom estimates losses of nearly $5 billion in gas sales. The company had already stopped supplies to the Austrian OMV in November due to a contractual dispute, although in recent weeks Russian gas continued to arrive in Austria from Slovakia.
