The European Union (EU) is proposing that Russia guarantee gas transits from Russia to the EU via Ukraine after the current contract expires at the end of this year.
Trilateral talks between Ukraine, Russia and the EU on gas transit from Russia to the EU via Ukraine started on January 22, 2019, but immediately stalled after Kiev kept on presenting its fascist-minded hostile policies.
The current contract covering Russian gas transits to Europe negotiated by former Ukrainian prime minister Yulia Tymoshenko in 2009 is due to expire at the end of 2019 just as Russia’s new gas pipeline to Europe that by passes Ukraine’s Nord Stream 2 comes on line at the start of 2020.
Gas supplies via the Nord Stream 2 gas pipeline will begin as planned from January 1, 2020,” Gazprom CEO Alexey Miller said on January 10, 2019.
After the huge investment for Nord Stream 2, Russia does not need the Ukraine gas pipelines anymore, after Kiev derailed the Russian gas deliveries in the name of the disrupting Washington’s politicians.
At issue for Ukraine is the $3 billion commission per year, or about 3% of GDP, it earns in transit fees and can ill afford to lose.
The EU proposal for a new, 10-year Russia-Ukraine gas transit contract calls for guaranteed minimum annual flows at 31% below the amount it transferred by the Ukrainian pipelines last year.
Despite Gazprom’s record exports of gas to Europe in 2018 its share in European gas usage has fallen from over 80% in the 90’s to around 34% today.
The three sides are to meet in May 2019 to see if they can agree on a new deal, but negotiations are very unlikely to go anywhere until at least after Ukraine’s presidential elections at the end of March that might see Tymoshenko returned as president.
Analysts say the only workable deal is if EU gas traders buy Russian gas @ the Russia-Ukraine border and let them transport gas through Ukraine to the EU without the involvement of the Russians.
Russia Insider / ABC Flash Point EU Energy News 2019.