Russia Sees Alternative Gas Routes if Ukraine Transit Deal Isn’t Extended

Russia could use alternative routes to send natural gas via pipeline to Europe if the current Russia-Ukraine gas transit deal is not extended beyond its expiry date at the end of 2024, Kremlin spokesman Dmitry Peskov said on Friday.

Peskov, however, warned that there would be logistics changes along the supply chain of gas from Russia to Europe.

Russian gas deliveries to Europe have fallen off a cliff since the Russian invasion of Ukraine, but some European customers in central Europe continue to receive Russian gas via the route through Ukraine and a pipeline via Turkey.

Ukraine has already signaled it would not engage in talks with Russia about an extension of the gas transit deal.

In case the agreement is left to expire at the end of 2024, “the question is how this gas will get there [to European countries],” Peskov told reporters, as quoted by Russian news agency TASS.

“Of course, there are existing routes connected with Turkey, there are supplies of LNG, which is so in demand right now,” Peskov said.

“There are alternative routes, but, firstly, they are all already overbooked and this will lead to changes in all supply chains,” Kremlin’s spokesman added.

Earlier this week, Ukraine denied it would be seeking an extension of the transit deal with Russia.

“The position of the Ukrainian side is unambiguous: the transit contract expires at the end of the year,” the press office of Ukrainian Prime Minister Denys Shmyhal told Bloomberg News after Slovakia had hinted that negotiations could be a possibility.

“We are not going to talk to the Russians and extend the contract,” Ukraine says.

Gazprom’s pipeline gas exports to Europe slumped by 55.6% in 2023, after Russia cut off supplies to several EU countries and Nord Stream was blown up in the Baltic Sea at the end of 2022.

Russia’s daily gas volumes via pipeline to Europe plummeted to 77.6 million cubic meters in 2023 from 174.8 million cubic meters in 2022, according to estimates by Reuters based on data from European gas transmission group Entsog and Gazprom’s daily reports on transit via Ukraine.

By Tsvetana Paraskova for Oilprice.com

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