Russian Gas Supplies Through Ukraine Turned Off

The Atlantic Council presents a pessimistic view regarding the prospect of smooth natural gas flow through Ukraine to European customers. Russia’s continued aggression and, in the Council’s view, strong possibility that Russia will occupy additional Ukrainian territory makes gas supply disruptions likely. European support for Ukraine could also impact Russian gas supplies that do not traverse Ukraine, like volumes delivered via the Nord Stream, Yamal and Blue Stream pipelines. “The underlying problem is that, right now, Moscow is involved in too many disputes with Kyiv to make it possible to envisage Russian gas flowing smoothly across Ukraine.” [Atlantic Council]

The US Treasury Department signed a $1 billion loan guarantee to Ukraine yesterday. “For its part, the United States will continue to work with the IMF, the other international financial institutions, and bilateral partners to support Ukraine as it takes the difficult but necessary reforms. To that end, I am very pleased that we are signing a $1 billion loan guarantee agreement today. This agreement, which was supported by the President and by both chambers of Congress on a bipartisan basis, demonstrates the United States’ unwavering commitment to seeing Ukraine stabilize and move its democracy forward.” [US Department of the Treasury]

Slovakia is working with Ukraine on an agreement to reverse the flow of a pipeline so that up to 9 billion cubic meters per year of gas could be supplied in the event of a Russian gas shutdown. But as much of Slovakia’s gas is supplied by Russia’s Gazprom, the company would need to bless the arrangement, which appears questionable. “Slovak Economy Minister Tomas Malatinsky said technical preparations may be completed in November. He said Slovak pipeline operator Eustream would invest the necessary 20 million euros. Any solution must be made in line with existing contracts or in consultation with Russian supplier Gazprom to make sure there are no sanctions against Slovakia for contract violations, he said.” [Reuters]