Norway provides €195mn in grants to cover Ukrainian gas purchases

Norway's government has agreed to provide Ukraine with €195mn ($200mn) in grants to cover its gas purchases this coming winter, adding to a €300mn loan issued by the European Bank for Reconstruction and Development (EBRD).

With spot gas prices in Europe soaring, war-ravaged Ukraine has been hard-pressed to afford gas supplies to supplement its domestic production. Those same high gas prices have led some European politicians to criticise Norway for benefitting from war and the resulting energy crisis. EU governments are pressuring Oslo to lower its prices, potentially as part of a bloc-wide cap that has been proposed on wholesale gas supplies.

"Helping Ukraine through this winter by supplying gas is of critical importance," Norway's minister for foreign affairs, Anniken Huitfeldt, said in a statement. "Russia uses energy as a weapon in this senseless war with grave humanitarian and economic consequences."

The Norwegian and EBRD funds will go to Ukraine's state-owned gas supplier Naftogaz, helping the company acquire gas for two annual cycles to households, public facilities and businesses.

Norwegian prime minister Jonas Gahr Store announced in July that Norway would be allocating 10bn kroner ($1bn) of support to Ukraine in 2022 and 2023 for humanitarian assistance and reconstruction efforts.

Moscow has shifted its strategy in Ukraine over the past month by targeting energy infrastructure with missiles and drone strikes, as Russian forces face ongoing setbacks on the battlefield that has seen them lose large swathes of territory in the Kharkiv, Kherson and Lugansk regions. The city of Kherson – the first regional capital to fall to Russian troops in the war – was recaptured by Ukrainian forces earlier this month.

Ukraine's prime minister Denys Shmyhal estimated last week that Russian attacks had crippled nearly half of the country's energy system.