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Page added on November 25, 2015
Russia Halts Natural Gas Supplies to Ukraine
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Gazprom will resume supply when Ukraine pays for more fuel
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Ukraine said no need for Russian gas now given low consumption
Russia halted natural gas supplies to Ukraine after its western neighbor said it wouldn’t buy more this year amid ample supply.
Ukraine’s NAK Naftogaz Ukrainy received its final prepaid volumes of Russian gas on Wednesday, Alexey Miller, chief executive officer of Gazprom PJSC, said in a statement, warning that the halt could threaten supplies to the rest of Europe during freezing weather. The European Commission said transit isn’t a concern at the moment, while Ukraine said it will keep shipping fuel to Europe strictly in line with the transit contract.
“During the past 18 months, we have demonstrated that we can ensure stable transmission of Russian gas regardless of whether we get it for Ukraine or not, both in the summer and the winter seasons,” Naftogaz CEO Andriy Kobolyev said in an e-mailed statement. “At this time a year ago we did not buy any gas from Russia, having less gas in storage and smaller import capacities from the EU.”
EU Flows
Eastern members of the European Union, which receives about 10 percent of its gas from Russia through Ukraine’s pipeline network, suffered winter shortfalls in 2006 and 2009 following payment disputes between Gazprom and Naftogaz. Such cuts are unlikely this time as Ukraine reduced its dependence on Russian gas and Gazprom decreased its reliance on transit through its neighbor, according to analysts.
“We’re not particularly concerned about the gas flows from Russia to Ukraine at the moment,” European Commission energy spokeswoman Anna-Kaisa Itkonen told reporters in Brussels Wednesday.
Ukraine can “easily” cope without Russian gas at least until the end of the year, said Alexander Paraschiy, a Concorde Capital analyst in Kiev. That would allow it to purchase cheaper fuel in the first quarter following a slump in commodities prices, he said. Ukraine’s lower gas usage means it doesn’t need more Russian gas this year, according to Energy Minister Volodymyr Demchyshyn on Monday.
Storage Levels
Ukraine has 16.5 billion cubic meters (580 billion cubic feet) of gas in storage as of Tuesday, 13 percent more than on the same day last year, according to data from Gas Infrastructure Europe. Dutch gas for next year, a European benchmark, climbed a second day, gaining 0.3 percent Wednesday, according to broker data compiled by Bloomberg.
Ukraine, reliant on Russian gas for more than 20 percent of its needs this year, halted imports from Gazprom in July because of a pricing dispute before resuming shipments in October to refill underground storage sites. Supplies restarted after the European Commission brokered an interim deal between the former Soviet allies. An international arbitration panel is to rule on their gas supply contract in mid-2016 at the earliest.
Russia and Ukraine plan to reach another EU-brokered deal by year-end, which will set prices for the first quarter. Gazprom won’t deliver gas until Ukraine advances more money, according to Miller’s statement. Naftogaz said further payments would depend on consumption.
Disputes between the governments in Moscow and Kiev flared up this week after power supplies to Crimea from Ukraine halted after sabotage on the cables to the Russian-annexed peninsula. Russia may seek reprisals as Ukraine delays restoring the power supplies, Russian Energy Minister Alexander Novak said Tuesday.
17 Comments on "Russia Halts Natural Gas Supplies to Ukraine"
Rodster on Wed, 25th Nov 2015 9:18 am
It should have happened a long time ago tbh. In fact if Russia were given a do-over they’d probably would have gone in and taken Ukraine back.
Kenz300 on Wed, 25th Nov 2015 10:06 am
Russia has never been a reliable partner or supplier ……
The sooner Europe transitions to alternative energy sources like wind and solar the better.
Wind Power Now Cheaper Than Natural Gas for Xcel, CEO Says – Renewable Energy World
http://www.renewableenergyworld.com/articles/2015/10/wind-power-now-cheaper-than-natural-gas-for-xcel-ceo-says.html
rockman on Wed, 25th Nov 2015 1:53 pm
Russia has always been a very good and stable supplier of NG to the EU and even to the Ukraine. As long as the buyer paid for the NG. Not supplying NG that isn’t being paid for does not make one an unreliable seller. But not paying for the NG makes one an unreliable buyer.
The article doesn’t explain the real potential problem for Russia and the EU buyers of the NG that flows thru the Ukraine. In the past not all the NG Russia put into the Ukraine pipeline system made it to the buyers in the EU. The Ukraine said they weren’t going to buy Russian NG…they didn’t say they weren’t going to siphon off some without paying for it. LOL.
Anonymous on Wed, 25th Nov 2015 3:25 pm
This Kenz fellow seems to be a bit of fool if he believes that. Russia is by any measure, as reliable a supplier as anyone. Of course, if you refuse to flat out pay even at the discounted rates, expect to get cut off at some point.(ie Ukraine). World famous for feeling it is under no obligation to pay for products and services delivered.
If he(KenZ) can, please provide objective, real world evidence that Russia has ‘never’ been a reliable supplier, I would like to see it. They are one of the world leading producers and have been for at least what? A century? They have like sold the ~ of trillions of dollars in revenue to buyers outside Russia proper, and besides well…Kenz, and neo-con mouthpieces, I dont see anyone else complaining.
Ill check back later when you have come up with the evidence to back up your assertion, ok? You are aware, alt-energy require fossil fuels to manufacture, maintain and distribute right? And the connection(s) between Russia being ‘unreliable’ and EU nations using more wind and solar is really not clear to me in any case.
apneaman on Wed, 25th Nov 2015 3:44 pm
Most of Crimea without power after transmission tower explosions
“MOSCOW — Two electricity transmission towers in Ukraine were damaged by explosions, leaving most of the nearly 2 million people on the disputed Crimean Peninsula without power on Sunday, the Russian Energy Ministry said.
Crimea was annexed by Russia last year but depends on Ukraine for most of its electricity supplies.
Two of the four transmission towers in Kherson, Ukraine, were damaged on Friday. Ukrainian activists calling for an economic blockade of the Black Sea peninsula tried to prevent repair works on Saturday, but retreated after clashes with police.
Around midnight, explosions hit the two other transmission towers, Ukrainian police said. They said it was not immediately clear who was responsible.”
http://www.thestar.com/news/world/2015/11/22/most-of-crimea-without-power-after-transmission-tower-explosions.html
Davy on Wed, 25th Nov 2015 4:12 pm
Anonomous, Kenz is an unresponsive bot If you can get him to speak I will grant you a wish.
rockman on Wed, 25th Nov 2015 4:18 pm
Some folks need to remember that today, in the eyes of Putin Crimea is notiks the eastern area of the Ukraine. It is a part of Russia. An attack on Crimea in any fashion is an attack on Russia. Tge should be more worried about Russian soldiers the Crimean police.
makati1 on Wed, 25th Nov 2015 8:17 pm
True, Rockman. The Russians are working to lay new power cables under the Black Sea to Crimea as we type. And are considering cutting off the coal shipments to Ukraine for the Kiev government allowing the terrorists to block repairs to the towers.
http://www.reuters.com/article/2015/11/24/ukraine-crisis-crimea-idUSL8N13J3YQ20151124?feedType=RSS&feedName=utilitiesSector#8xLycvpyeSptRPhe.97
The powder keg is open, who will be the match?
dissident on Wed, 25th Nov 2015 9:54 pm
Ah yes, those Pavolvian trigger phrases in every NATO media piece “annexed Crimea”. I guess according to NATO drones the local population has no say, legality has no role to play, and it is only the decision of some stooge and his foreign backers in 1991 that gets to decide. Tough luck for you that your “recognition” is not worth squat.
Boat on Wed, 25th Nov 2015 11:30 pm
The Ukraine struggled to pay their their nat gas bill when Putin’s cronies were in charge. These same cronies didn’t develop the Ukraine’s nat gas even though it is available. Wasn’t this the problem in the first place? The larger chunks of the population sensed no chance at improvements unless they traded more with Europe with an eye towards joining the European Union. They saw countries advance much faster than them after WWII and just want to do the same.
GregT on Thu, 26th Nov 2015 12:11 am
It isn’t “The Ukraine” Boat. The country is called Ukraine. “The Ukraine” was a term used in the former Soviet Union which meant “borderland’.
As usual, your idiocy shines through.
charmcitysking on Thu, 26th Nov 2015 1:55 am
Headline propaganda? I guess Russia “halting” gas supplies is the same thing as Ukraine not buying them due to oversupply (as the article states)
GregT on Thu, 26th Nov 2015 2:21 am
Russia has natural gas for sale. Ukraine was offered a deal to buy that natural gas which the western installed oligarchy declined. Russia is not obligated to sell her resources to anybody else at any price, and she is certainly not obligated to give them away, even though the deal that she offered Ukraine amounted to as much.
The European promise to Ukraine was nothing more than financial terrorism. Lend them money, enslave them with debt, and give their resources away to multinational corporate interests and the corrupt international banking cartels. If the West stood by democratic principles, the people in Eastern Ukraine should have been recognized internationally in their aspirations to their rights to self determination.
Instead, the west has supported genocide, and the ethnic cleansing of the Russian people of Eastern Ukraine in their multigenerational homelands. Completely immoral, unjust, and quite frankly sickening.
Rodster on Thu, 26th Nov 2015 7:36 am
Looks like Greg summed up the situation in Ukraine quite nicely.
makati1 on Thu, 26th Nov 2015 10:10 pm
Ooops!
http://www.pravdareport.com/news/russia/25-11-2015/132701-ukraine_coal_russia-0/
“Russian Energy Minister Alexander Novak, the newspaper wrote, previously suggested that the termination of coal deliveries to Ukraine is likely to become Russia’s response to Ukraine’s actions to cut supplies of electricity to the Crimean Peninsula.”
Gonna get cold in Ukraine this winter…lol. Yep! “Cut off your nose to spite your face!” is the new Ukrainian motto.
Kenz300 on Fri, 27th Nov 2015 10:13 am
How much should Russia pay for annexing the Crimea…..
Free gas for the Ukraine forever…….
makati1 on Fri, 27th Nov 2015 5:29 pm
Kenz, I hope you are just playing the fool…