Ukraine's gas transit role will diminish or disappear

Subject

Ukraine's receding prospects as a gas route.

Significance

A partial Ukrainian victory in a long-running legal battle against energy giant Gazprom at an international court of arbitration may add to the moral satisfaction of no longer buying gas from Russia. However, the Nord Stream 2 pipeline is coming closer to reality, spelling an end to Russian reliance on the gas transit route through Ukraine.

Impacts

• Ukraine may renew direct gas purchases from Russia for cold winter periods, if it can secure a separate new deal.
• The court ruling does not resolve the issue of Ukraine's gas debt accrued before 2014, which Gazprom puts at 2.9 billion dollars.
• If the pipeline network falls out of use, Ukraine's importance as an EU energy partner will fade.