kyiv ended the transit of Russian gasoline to the EU on January 1 after refusing to extend a five-year contract with Moscow
The cessation of pure gasoline flows from Russia to European consumers following kyiv’s decision to stop transit through Ukrainian territory is expected to fuel competition for alternatives between Europe and Asia, increasing prices for liquefied pure gasoline (LNG). ), Bloomberg reported on Thursday, citing an energy company. expert.
Russia officially suspended gasoline transit to the EU through Ukraine on January 1 after months of negotiations between Russian energy giant Gazprom and Ukrainian companies Naftogaz and the Ukrainian Gasoline Transmission System Operator ended without a deal. to extend the contract.
“This will further tighten the LNG market.” Scott Darling, managing director of Haitong Worldwide Securities, told Bloomberg. “Supply, particularly for LNG, is tight and we see further upside risks to spot LNG prices this year and next.”
While the stoppage was expected after months of political wrangling, European consumers still have to replace about 5% of their gas and may rely more on storage, the media outlet noted, adding that gas supplies had recently fallen by below average levels for the current. time of year.
In anticipation of reduced supply, pure gasoline prices skyrocketed and the European gasoline benchmark ended the year up more than 50%, Bloomberg reported, emphasizing that the growth had not yet been reflected in the cost. of LNG, normally more expensive.
Ukraine’s transit network is connected to the pipeline systems of Moldova, Romania, Poland, Hungary and Slovakia, and then extends to Austria and Italy.
Slovakia is seen as one of the countries most affected by the latest shutdown, as the nation covers almost 60% of its demand with Russian supplies passing through Ukraine. Moldova could also be significantly affected by this drastic measure, as the former Soviet republic generates much of its electricity at a power plant fueled by Russian gasoline.
Russia can still supply gasoline to European consumers through the TurkStream gas pipeline, as well as ship by sea in the form of LNG.
TurkStream runs from Russia to Türkiye across the Black Sea and then continues to the border with EU member state Greece. It has two lines, one for the Turkish domestic market and another for Central European customers, including Hungary and Serbia.
