Russian attacks force Ukraine to buy costly gas from EU, Bloomberg says
Pravda Ukraine
Russian missile attacks on Ukrainian state-owned gas assets have compelled the country to purchase costly alternative fuel from the European Union.
Source: Bloomberg
Details: Russian airstrikes have reduced production at key Ukrainian producer Naftogaz by a third, meaning the country will need to import approximately 1 billion cubic metres of gas.
Although this is less than 1% of Europe’s annual demand, it comes as futures trading nears its highest level in two years amid supply concerns. Since Russian gas flows through Ukraine were cut off earlier this year, gas reserves in the region’s storage facilities have been rapidly depleted.
Ukraine reportedly received 724 million cubic metres of gas from abroad in 2024, the lowest level since records began. About a third of this was later re-exported to western neighbours who utilised Ukrainian national storage facilities.
Naftogaz, which accounts for about 80% of the country’s total production, increased gas production by 5% last year to 13.9 billion cubic metres.
This week, additional gas volumes began flowing into Ukraine as Slovakia resumed supplies through the Budince border crossing for the first time since October.
Naftogaz CEO Roman Chumak stated that gas reserves in storage sites are sufficient for stable operation this winter and the situation is under control. He added that the company will import gas “to be ready for all the challenges of the war”.
Background:
- In 2024, Ukrgasvydobuvannya, a member of Naftogaz Group, increased commercial gas production to 13.9 billion cubic metres, up from 13.2 billion cubic metres in 2023.
- On the morning of 15 January, Russia attacked Ukraine’s gas infrastructure.
- In the first nine months of 2024, Naftogaz Group reported a net consolidated profit of UAH 23.3 billion [approximately US$561.1 million]. In the same period last year, the figure stood at UAH 15.3 billion [roughly US$368.4 million].
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