According to Russian President Vladimir Putin, Ukraine’s decision not to renew its gas pipeline deal with Russia will hurt Europe more than Moscow. The 2019 agreement let Russia pump gas through Ukrainian land, which was good for both Moscow and Kyiv.
According to a recent statement from Ukrainian President Volodymyr Zelenskyy, the deal will not be extended after the end of this year. This move will likely affect European countries that depend on Russian energy because less gas will be going to them.
The Eastern Economic Forum heard what Russian President Vladimir Putin had to say. in Vladivostok, “Ukraine’s refusal to continue gas transit means less gas for Europe.” “We will focus on supplying gas within our own country, which will slightly lower our income.”
Since the war began in 2022, Russia has cut Europe’s gas imports by more than 90%. European Union (EU) sales have slowly decreased, causing Russia to find new buyers, mainly in Asia, with China becoming a major market.
The majority of Russia’s old gas lines to Europe are no longer in use. Gas sources were further limited when the Nord Stream pipeline, a major route, was destroyed in September 2022. The 2019 deal ends, but Russia can still send gas through the Sudha entry point until then.
Because Ukrainian transportation is no longer available, both countries will lose money. Ukraine’s transfer fees bring in about $800 million a year, which is a small fraction of its GDP. Furthermore, the lost travel route could cost Russian energy giant Gazprom up to $5.5 billion a year, which is about 6% of its annual income.
Europe is looking for other energy sources, and Russia is improving its links with Asian markets to become less reliant on European buyers. Russia’s and Ukraine’s economies will still be affected by the change, though Europe may feel the effects more strongly.
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