Russia’s Gazprom Reduces Gas Flows To Europe Via Ukraine

Gazprom is reducing pipeline gas transit flows to Europe via Ukraine for a second consecutive day on Friday, the Russian gas giant said in a statement carried by Bloomberg.

Russia still sends some gas via pipelines to Europe, via one transit route through Ukraine and via TurkStream.

Gazprom did not give a reason for the reduced flows via Ukraine. According to analysts, the lower pipeline flows were the result of lower demand for gas under long-term contracts, considering the milder weather in parts of Europe and the fact that spot supply is currently cheaper.

On Friday morning, gas transit flows from Russia via Ukraine were down to

24.4 million cubic meters, compared to 25.1 million cubic meters on Thursday and 32.6 million cubic meters earlier this week.

Despite the lower volumes of Russian pipeline gas supply, European benchmark gas prices dropped on Thursday amid still ample gas storage levels across the EU – due to the mild weather so far this winter – and to continued inflows of LNG cargoes.

The real concern about gas supply in Europe is for the winter of 2023/2024, the top executives of Europe’s biggest oil and gas majors said just before this winter heating season began. At the end of last year, the top executives at other European majors, including BP’s Bernard Looney and Eni’s Claudio Descalzi, said that Europe was more or less prepared to face this winter with nearly full gas storage sites and a steady flow of LNG imports.

“But as we said, the issue is not this winter. It will be the next one, because we are not going to have Russian gas – 98% [less] next year, maybe nothing,” Descalzi said at the ADIPEC conference in Abu Dhabi in November.

With the plunge in Russian pipeline gas deliveries, Europe will need “huge volumes” of LNG imports this year, commodity trader Trafigura said in December.

By Tsvetana Paraskova for Oilprice.com

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