Russian gas exports through Ukraine via Soviet-era pipelines ceased on New Year’s Day after decades of Moscow’s hegemony in Europe’s energy markets.

Russian gas continued to flow despite almost three years of conflict, however, Ukraine’s refusal to renew a transit agreement stopped Russia’s gas company Gazprom from flowing into the European Country.

The much-anticipated halt will not affect EU consumer prices, in contrast to 2022 when declining Russian supply drove prices to all-time highs, exacerbated a cost-of-living crisis, and hurt the bloc’s ability to compete.

The European Union increased its efforts to find alternative energy sources to lessen its reliance on Russian energy following the start of the conflict in Ukraine in 2022.

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While Hungary will continue to receive Russian gas through the TurkStream pipeline beneath the Black Sea, the last EU buyers of Russian gas via Ukraine, including Slovakia and Austria, have set up alternative supplies.

Volodymyr Zelenskiy, the president of Ukraine, called the termination of gas transit through his nation to Europe “one of Moscow’s biggest defeats” and urged the U.S. to provide Europe with more gas.

“We will more quickly overcome the final negative effects of European energy dependence on Russia if there is more available on the market from Europe’s true partners,” he wrote. Supporting the former Soviet state of Moldova “in this period of energy transformation” was Europe’s “joint task” going forward, he wrote. “

Russia and the former Soviet Union gained a significant portion of the European gas market, reaching a peak of about thirty-five percent. However, since the beginning of the conflict in Ukraine, the EU has reduced its reliance on Russian energy by purchasing more LNG from Qatar and the US and piped gas from Norway.

Olumide Adesina

Financial Market Writer

Olumide Adesina is a French-born Nigerian financial writer. He tracks, analyzes, and reports changes in financial markets with over 15 years of working experience in investment trading.