- Russian gas flowing to Europe via Ukraine fell by a quarter on Wednesday as Kyiv closed a major transit route.
- German energy regulator Bundesnetzagentur said on Twitter it’s closely monitoring the situation.
- Despite hard-hitting sanctions against Russia, the EU continues to import its natural gas.
Ukraine officially shut off the flow of Russian natural gas that crosses its territory to Europe, cutting supply by a quarter on Wednesday, marking the first direct hit to the regional energy market since the war began.
Ukraine halted flows from the key Sokhranovka transit point in southern Russia, according to Reuters.
Grid operator Gas Transmission System Operator of Ukraine first warned of the closure on Tuesday. The company blamed Kremlin’s occupying troops for interfering with gas infrastructure and for siphoning fuel, it said in an announcement on Tuesday.
Benchmark Dutch natural gas futures jumped 8% on Thursday in response. The EU gets about 40% of its natural gas from Russia. and a one-third of this runs through pipelines that cross Ukraine.
It was not immediately clear how long the disruption would last and what the impact on the wider European economy might be. German energy regulator Bundesnetzagentur said on Twitter it was closing monitoring the situation.
Despite hard-hitting and sweeping sanctions against Russia, the EU has continued to import its natural gas, prompting criticism that the bloc is funding the war in Ukraine. The bloc has pledged to end its reliance on Russian gas “well before 2030,” according to Reuters.
Ukraine’s shutdown of some Russian gas to Europe could be a strategic move, an analyst told the Associated Press.
“I think frustrations are building in Ukraine that Europe is proving too slow in rolling out an energy embargo on Russia,” Tim Ash, senior emerging markets sovereign strategist at BlueBay Asset Management, told the AP. “If Europe is not prepared to shut off the energy money printing machine for Moscow, why would Ukraine not take matters into their own hands?”
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