So, what happened as a Consequence of Ukraine Not Renewing its Natural Gas Transit Deal in 2025? According to Reuters, "Russia's pipeline gas exports to Europe sank by 44% in 2025," its Lowest Level in more than 50 years. The EU has an Ambitious Plan for Discontinuing Gas Imports from Russia by the End of 2027. Part of the Initiative concerns how their Gas Imports Fund Russia's Wwar Economy, and at the same time, they would like to Reduce Dependence, as they Transition to Green Energy.
Reuters also Highlights that "Europe was Russia's biggest source of budget revenues from oil and gas sales," and that is No Longer the Case. Ukraine's Decision Hurt Russia, and in particular Gazprom, where it Hurts most, in their Pockets. There is still Gas Flow to Europe via TurkStream, which serves: Hungary, Serbia, Slovakia, and Turkey. Tankers also Transport Gas in Liquid Form to the Rest of Europe for now.
On January 1st of 2025, Ukrainian President Volodymyr Zelensky stated in a social media post that the halting of gas transit through Ukraine represented a significant setback for Moscow during the current conflict. In December of 2024, Ukraine announced it would not renew the contract with Russia to transport Moscow’s gas to European markets via Ukraine’s older Soviet-era pipelines. As a result, gas transit via those pipelines stopped on January 1st, 2025.
“We won’t allow them to earn additional billions off our blood,” Zelensky stated in early December of 2024 after he announced that his government decided to end Russian gas transit through Ukraine, according to the New York Times. The end of Russian gas transit through Ukraine was part of a broader plan to support the war that Kyiv and its allies were fighting against Moscow as they worked to move the European continent away from reliance on Russian gas.
"When Putin was handed power in Russia over 25 years ago, the annual gas pumping through Ukraine to Europe stood at over 130 billion cubic meters,” Zelensky said in his January 1st, 2025, message on Telegram, according to The Kyiv Independent. “Today, the transit of Russian gas is 0,” Zelensky added. “This is one of Moscow's biggest defeats. Turning energy into a weapon and cynical energy blackmail of partners is what deprived Russia of its most attractive and geographically accessible market."
The end of Russian gas transit through Ukraine has been a significant blow to Moscow. Still, it may not be as damaging to the Kremlin’s overall gas business since the amount of gas that transited through Ukraine has been relatively small in recent years. According to Reuters, the five-year gas transit deal that ended in January 2025 saw only roughly 15 billion cubic meters of gas transit through Ukraine in 2023. That was 8% of its peak total gas flows via its other routes to European markets from 2018 to 2019.
The New York Times reported that at its peak, Russian gas accounted for 40% of Europe’s gas consumption. However, once Russia invaded Ukraine, that number fell considerably thanks to sanctions. The Urengoy-Pomary-Uzhgorod pipeline was developed under the Soviet Union and transports gas from Siberia to Europe through Ukraine, via the border city of Sudzha in Kursk.
"We stopped the transit of Russian gas. This is a historic event,” the Ukrainian Energy Minister German Galushchenko said in a statement according to Reuters at the time. “Russia is losing its markets, it will suffer financial losses.” While the stoppage of Russian gas transported through Ukraine might be a win for Kyiv, it also presented new challenges for the embattled Ukrainians.
Pipelines may be new targets. The New York Times reported at the time that military analysts have suggested that Ukraine’s extensive gas pipeline network, which has been largely spared from attack since Moscow invaded Ukraine, could become a target since the incentive to protect it is now gone. Ukraine also ran the risk of retaliatory measures being imposed against it by European countries friendly to Russia and dependent on its gas, like Slovakia, which threatened to cut off power to Ukraine after ending Russia's gas transit, Bloomberg noted.
While the Future Retaliatory Measures Ukraine might Face from Russia or other European Countries are Unknown, we do know that the End of Gas Transit through Ukraine will serve as a Significant Financial Blow to Moscow.
NYC Wins When Everyone Can Vote! Michael H. Drucker
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