Ukraine needs additional 5 billion cubic meters of gas

30 september 2014

Head of the Department for Strategic Studies in Energy of the Analytical Center Alexander Kurdin took part in the roundtable “Energy security in Europe: results of tripartite negotiations on gas”, held at the Press-Center of IIA “Russia today”.

During the event, experts talked about the results of the meeting on the “gas issue”, held on September 26 in Berlin between Russia, the EU and Ukraine. Experts have discussed the possible risks of gas transit through the territory of Ukraine, ensuring the safety of Russian supplies to Europe and prospects for cooperation between Russia and the EU in the energy sector. Participants noted that the main objective of the meeting was to ensure continuity in gas supply in the coming winter via Ukraine to the EU countries, as well as the resumption of supplies to Ukraine, which has not yet paid off the debts for the previously delivered gas.

Alexander Kurdin gave his assessment regarding the negotiations. The expert noted that, when Ukraine began to actively save gas, extensive discussions were held on the topic of how much gas does this country actually needs. “For the first half of 2014 a lot of gas has been delivered to Ukraine - 14 billion cubic meters, - said Mr. Kurdin. - It's more than the quantity delivered in the first half of 2013, so now they have a little reserve”. Nevertheless, the expert believes that Ukraine will need an additional 5 billion cubic meters of gas. “We cannot presume that Ukraine could sharply reduce gas imports which had amounted to $ 25 billion in 2013, to cover its own consumption and find the necessary solutions to existing technical issues, - said Mr. Kurdin. – So, 5 billion cubic meters of gas are absolutely necessary for Ukraine”.

“Last year, the average price of the reverse supply was about $ 400 per thousand cubic meters. Russian gas was a bit more expensive, - said the expert on the cost of supplies. - That means that the price will not go down significantly compared to the $ 400 mark. Another thing is that now the European spot price is much lower”. According to him, this may cause some issues for Ukrainians and lead to Russia setting specific requirements. Mr. Kurdin recalled that this summer in Europe, the price has dropped to $ 250 per thousand cubic meters but now it is slightly higher - about $ 300. But the difference in the price offered by Gazprom, still exists, he added.

“Europeans are interested in a trouble-free transit, - believes Mr. Kurdin. - But at the same time they are in a good situation”. According to him, Ukraine has 76 billion cubic meters of gas at the moment. “This is more than the quantity the country had in recent years, - said the expert. - These values ​​are usually reached in late October - early November, so we can say that EU has a certain stock at the moment”.

The video of the event can be found on the website of the Press-Center IIA “Russia today”.