Russia Calls Gas Sales to Europe 'Complicated' as Ukraine Transit Deal Nears End

Russia has described the situation surrounding natural gas sales to Europe via Ukraine as "very complicated" following talks between President Vladimir Putin and Slovak Prime Minister Robert Fico, as reported by Reuters. This comes as a five-year deal for Russia to transit gas through Ukraine to Europe is set to expire at the end of the year.

Ukraine has stated it will not renew the agreement, citing its desire to avoid aiding Moscow's military efforts in the ongoing conflict. The deal currently facilitates around half of Russia's total pipeline gas exports to Europe, affecting countries like Slovakia, Italy, Austria, and the Czech Republic.

Kremlin spokesman Dmitry Peskov, while declining to elaborate on the details of Putin and Fico's Sunday talks, confirmed that Putin reiterated Russia's willingness to continue supplying Slovakia with gas. However, Fico countered that this was "practically impossible" once the Ukraine transit deal expires, highlighting the uncertainty surrounding alternative supply routes.

Slovakia has indicated that while the loss of Russian gas through Ukraine would not significantly impact its consumption due to diversified supply contracts with companies like BP, ExxonMobil, Shell, Eni, and RWE, it would lead to higher costs. The country is also seeking to preserve the Ukrainian transit route to maintain its own transit capacity.

The potential disruption to gas supplies has already impacted European markets, with the benchmark front-month contract at the Dutch TTF gas hub rising 1.52 euros to 45.33 euros per megawatt hour, according to LSEG data.

Ukrainian President Volodymyr Zelenskiy criticized Fico's apparent reluctance to end his country's dependence on Russian resources, calling it a "big security issue" for Europe and Slovakia. Hungary has also expressed interest in maintaining the Ukrainian route, although it will continue to receive Russian gas from the south via the TurkStream pipeline.

Zelenskiy suggested last week that the transit deal could potentially be renewed, but only if Russia is not paid for the gas until after the war ends—a condition unlikely to be accepted by Moscow.

"You heard the statement from the Ukrainian side, and you know about the positions of those European countries that continue to buy Russian gas and that consider this necessary for the normal operation of their economies," Peskov told reporters. "Therefore, there is now a very complicated situation here that requires increased attention."

Putin had previously stated last week that a new deal with Kyiv for Russian gas transit through Ukraine was not feasible.