Ukraine to Halt Russian Natural Gas Transit Next Year

According to Ukrainian media, on the 29th of the local time, the head of Ukraine's state-owned natural gas company, Chernyshov, announced that they will cease the transit of Russian natural gas through Ukraine by the end of 2024.

The official emphasized that Ukraine currently permits Russian gas transit only to support its European partners. The contract for Russian gas transit through Ukraine to the European Union is set to expire at the end of 2024, and Ukraine does not intend to renew this contract.

Sergey Chernyshov, Director of the Institute of Russian, Eastern European, and Central Asian Studies at the Chinese Academy of Social Sciences, analyzed that Ukraine's decision is driven by both "objective reasons" related to expiring commercial contracts and "subjective factors" to enhance its own influence.

The previous natural gas transport agreement was signed by the national energy companies of both countries. However, Russia and Ukraine have effectively severed all official contacts, making it challenging for energy companies to renegotiate and sign such an agreement.

Ukraine aims to curtail and restrict Russia's natural gas exports through this move. Additionally, Ukraine seeks to bolster its influence in Europe, especially in response to some Central and Eastern European countries obstructing Ukrainian grain exports.

If Ukraine stops the transit of Russian natural gas through its territory by the end of 2024, it implies that an important energy supply route between Russia and Europe will be severed starting in 2025.

Sergey Chernyshov further analyzed that these measures may compel Russia to adjust its energy industry structure and transportation methods.

Since February of last year, with the European Union imposing energy sanctions on Russia, the quantity of Russian natural gas imports by EU countries has decreased to only one-third to one-fourth of the previous amount.

Due to its limited share, even if Ukraine cuts off the energy route between Russia and Europe, it won't have a particularly significant impact on the Russian economy and natural gas exports.

However, in the long term, it will certainly affect Russia's natural gas cooperation with Europe. Russia may have to make adjustments to the direction of natural gas exports and production structure, such as increasing liquefied gas production, constructing new pipelines, and seeking new natural gas export partners.

Sergey Chernyshov further pointed out that if Europe can't obtain Russian natural gas through Ukraine, it will be forced to expedite the diversification of its energy sources.

The European Union will expand its natural gas imports from other sources, such as importing more gas from Norway or purchasing more liquefied natural gas from the United States.

However, this will increase energy costs and may exacerbate energy crises in some European countries, especially those located inland, leading to potential conflicts with Ukraine.

European countries will also increase the proportion of traditional energy sources while developing new energy sources like solar power to address energy crises. However, fully replacing natural gas imports from Russia is quite challenging and will undoubtedly affect the economic recovery of European countries.

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