Ukraine's European Gas Imports Rise on Year

Ukraine imported twice as much gas from Europe in 2015 than it did in 2014, when it began to buy gas from Europe in preference to Russian export monopoly Gazprom, Ukraine's state-owned oil and gas company Naftogaz Ukrainy said February 1.

It imported 10.3bn m³ from the west in 2015, compared with 5bn m³ the year before. More than 10 companies supplied gas from the west. However, Ukraine is still not importing as much gas as it possibly could through Slovakia as the Budnice pipeline is capable of carrying over 14bn m³/year.

Imports from Russia fell from 14.5bn m³ to 6.1bn m³, and Russia’s share of Ukraine’s domestic consumption fell from 34% to 18% over the period.

There was also a material increase in imports from the west under contracts with private traders and consumers. Naftogaz imported less from Europe in favour of private importers. Last year they bought 7.5 times more than in 2014, or 1.1bn m³ compared with 0.14bn m³. This change was enabled by the law on the natural gas market of last October and other measures aimed at making Ukraine an open gas market.

It was once one of the most opaque markets in the region, being closely tied up with politics and with intermediate private companies – such as Yulia Tymoshenko's UES – set up in the post-Soviet era to buy gas from Russian entities and sell it to big industrial buyers in Ukraine.

Since the Orange Revolution in 2004 Kiev has wanted to reduce gas imports from Russia but it was only with the re-opening of the modest Budnice pipeline from Slovakia that it has been able to do anything substantial about it. 

 Ukraine's gas imports: source and delivery route (bn m³/yr)

Source: Naftogaz Ukrainy

William Powell