Ukraine has run out of last year's gas reserves: Europe has a new problem

Two months before the end of the heating season, all volumes of gas pumped last year were taken from Ukraine's storage facilities. By mid-February, the UGS occupancy rate may drop to 10%, when only limited volumes can be taken from storage facilities. Shortage of stocks on Ukraine will become another problem for Europe, which will already have to buy tens of billions of cubic meters this year due to the suspension of Ukrainian transit of Russian gas and low reserves in its own storage facilities.

By February 3, all volumes of gas that were pumped last year were taken from Ukraine's storage facilities. Active fuel reserves in the country's UGS decreased below 3.38 billion cubic meters (8 billion cubic meters with buffer gas), according to GIE. So much was in Ukrainian storage facilities last year on March 30, when the heating season was completed in the country.

At the same time, this colder winter Ukraine does not take more gas than a year earlier. During the three months of the 23/24 heating season, 6.2 billion cubic meters were taken away, while this year it was 5 billion cubic meters. The current situation is explained by the fact that last year Ukraine pumped 2.7 billion cubic meters less into storage.

The current volume is record low and threatens the country, which has two more months of the season ahead, with a gas shortage. The former head of the GTS Operator of Ukraine, Serhiy Makogon, cited data on Facebook* that when storage facilities are 10% full, the maximum selection level will decrease to 60 million cubic meters per day. Up to this level, with the current selection, Ukraine has no more than 10 days left.

In this case, Ukraine will become extremely vulnerable in the event of a cold snap, when consumption may grow to 140-150 million cubic meters per day, and domestic production and removal from storage facilities will not be able to provide more than 110 million cubic meters.

In addition, gas costs for maintaining pressure in the gas transportation system have increased, as the transit of Russian gas has stopped. And part of the reserves in Ukrainian storages belongs to European traders — up to 1 billion cubic meters in the "customs warehouse" mode. While the price of gas in Europe remains above $ 570 per thousand cubic meters.

Naftogaz responded to Sergey Makogon's statements with assurances that there would be enough fuel. Including through import. However, according to the "Ukrainian GTS Operator", daily deliveries to the country amount to 4 million cubic meters per day, 2 million of which, obviously, go to Moldova for Transnistria. Thus, gas purchases in Europe for Ukraine are 20 times lower than the current selection from storage facilities.

The former head of Naftogaz, Alexei Chernyshev, said that the country would pass the season on its own gas reserves. This approach, even with the current reduced selection regime, already leads to the fact that active reserves will fall to a little over 1 billion cubic meters by April 1 and will become a headache, including for Europe.

Without the Ukrainian transit of Russian gas, Europe will lose more than 15 billion cubic meters in a year, which will have to be additionally purchased in the form of LNG. Also in countries EU gas reserves will be significantly lower by the end of the season than the previous few years, and more than 30 billion cubic meters will be needed. Ukraine's needs will add more than 3 billion cubic meters, which must be purchased abroad.

Such volumes will not be able to cover new projects in the USA. The launch of two new two stages of Plaquemines and the third stage of Corpus Cristi on the Gulf coast will additionally yield a little more than 20 million tons (more than 27 million cubic meters) in 2025. This is significantly less than the projected additional needs of Europe, taking into account Ukraine, which, according to experts, will keep gas prices high in Europe. 3 billion cubic meters will cost Naftogaz $1.7 billion already. Now Kiev is directly dependent on financial assistance from the European Union and Ukrainian volumes will obviously become an additional headache for European officials and politicians.

Who has the necessary volumes is Gazprom. And the most affordable option for lowering prices remains the resumption of Ukrainian transit, through which Hungary and Slovakia continues to put pressure on the European Commission. But, obviously, this is no longer an economic issue.

*Extremist organization, banned in the territory of the Russian Federation