2024-09-01 03:33:16
Ukraine is stopping the transit of Russian gas and oil at the turn of the year. This is putting pressure on Hungary and Slovakia in particular.
Ukraine wants to stop the transit of Russian oil and gas to the EU from 2025. This was stated by Mykhailo Podoliak, adviser to President Volodymyr Zelensky, in an interview with the Ukrainian broadcaster Nowyny.Live on Friday.
Ukraine has signed contracts as a transit country that are valid until January 1, 2025, and that the country cannot terminate unilaterally. “But without a doubt, this will all stop on January 1, 2025,” said Podoliak. However, Kyiv is ready to transport gas from the countries of Central Asia or Azerbaijan to Europe. For Ukraine, it is crucial to deprive Russia of its sources of income from the sale of raw materials.
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Earlier this week, President Zelenskyj announced that an agreement for the transit of Russian gas, which expires at the end of the year, would not be extended. “It’s over,” the Ukrainian president said last Tuesday with regard to the expiring contract.
The contract for the transit of Russian gas through Ukraine to Europe between the state-owned companies Gazprom and Naftogaz ends on December 31, 2024. Despite the war of aggression started by Moscow more than two years ago, it has so far been fulfilled – also at the urging of Ukraine’s European neighbors, especially Hungary.
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Ukraine is now increasing the pressure on those European countries that have so far made little effort to break free from dependence on Russian energy. This includes Hungary and Slovakia. Furthermore, Austria continues to import pipeline gas from Russia, and according to the Austrian “Kleine Zeitung” last June, this still accounts for 83 percent of its total imports of the energy source. The EU countries have agreed not to import any more Russian gas by 2027.
In addition, the Czech Republic still receives Russian oil via the Druzhba pipeline, albeit to a lesser extent. The country is already working on alternatives. According to Prime Minister Petr Fiala’s statement last June, the Czech Republic originally planned to become independent of Russian oil by mid-2025. Last year, the Czech Republic still got a good 60 percent of its oil from Russia.
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However, the completion of the project to expand the Italian Transalpine Pipeline (TAL) will put an end to this dependency. From 2025, the TAL will transport four million tonnes more crude oil than before, and the Czech Republic will then receive eight million tonnes per year – the country’s total demand. The TAL pipeline transports crude oil from Kazakhstan from the Italian port of Trieste to southern Germany.
Hungary and Slovakia could probably take a similar approach: The former head of the Ukrainian operator of the transit network, Serhij Makohon, told the newspaper “Kyiv Post” in early August that the Adriatic pipeline could be extended for this purpose. This transports oil from Kazakhstan, Kuwait and other OPEC states via Croatia. “But they have done nothing for two years.”
For Ukraine, however, the end of gas and oil transit does not mean a great loss. According to estimates, Kiev has recently made around 250 million US dollars in profit annually from transit. Total state revenues amount to around 43.7 billion US dollars, so transit accounts for just over 0.6 percent of revenues. Russia, on the other hand, is said to earn around six billion US dollars annually from oil exports.
Last June, Ukraine imposed sanctions on the Russian energy company Lukoil. At the end of July, the country completely stopped the transit of Lukoil oil via the Druzhba pipeline. The governments in Hungary and Slovakia reacted angrily to the punitive measures. In Budapest, there were even fears of an energy crisis. Prime Minister Viktor Orbán’s chief of staff spoke of “blackmail”. According to the US newspaper “Politico”, Hungary imported around 70 percent of its oil from Russia.