Gas Logistics Between Russia and the EU: Case of Ukraine, Belarus, Nord Streams and Other Routes of Supply

Abstract

The supply of the Siberian gas to Western Europe through Ukraine and Slovakia originated during the Cold War. Post-Soviet Russia has widened its gas expansion through the construction of new pipelines, most of which were built during the Putin period. Gas and gas infrastructure remains an instrument of Russia’s foreign policy. Russian Gazprom has repeatedly cut off gas supplies to the EU, causing pan-European gas crises. Large-scale disruption of gas supply through Ukraine (2006 and 2009) and Belarus (2004), caused by Russia, were used to justify the construction of Trans-Baltic and Trans-Black Sea gas transmission systems bypassing the Ukrainian-Slovak gas corridor. Following the signing of the Association Agreement with the EU in 2014, Ukraine has reformed its gas market in accordance with European energy legislation. This enabled reverse gas supplies from the EU member states to Ukraine. The implementation of the Nord Stream 2 and TurkStream bypass projects by Russia will nullify transit through Ukraine. The lack of a physical flow of gas from east to west will mean that it is impossible to take a part of it for the reverse flow from the EU to Ukraine. Crises in conventional gas pipelines in the EU have dramatically increased interest in LNG. The European gas market has received additional impetus for development. LNG is becoming a game changer for the gas market, making it less dependent on traditional pipeline supplies. Russia’s bypass projects, such as Nord Stream 2, are becoming relics of the Putin era as non-market instruments. The Baltic Sea and Eastern Mediterranean countries are building a gas infrastructure that can operate efficiently with both pipelines and liquefied natural gas. This creates new opportunities for the integration of East European countries into the EU gas market. Ukraine’s gas infrastructure, in particular its powerful underground gas storages, is serving common market purposes and may be the basis for a regional East European gas hub.