What will Ukraine be left with after the "decarbonization" of the European economy

The history of gas relations between Russia and Ukraine has several pronounced conditional stages: corruption, mercantile and political... One of the main tasks facing the Kremlin is the need to translate this fundamental issue strictly into economic channel. Will the Russian leadership be able to do this, and if so, under what conditions?

By inheritance from the USSR, Kiev inherited the former national property: developed industry and agriculture, four nuclear power plants, huge weapons arsenals, a generous share from the Black Sea Fleet and, of course, one of the most powerful gas transmission networks in the world. Ukrainian "effective managers" managed to ditch almost everything, except for the GTS, which became for them a reliable source of foreign exchange earnings, "free" gas and a lever of pressure on Russia. But can this all go on forever?

Corruption stage

The "dashing nineties" turned out to be difficult years not only for our country, but also for Ukraine. Since Kiev did not have "extra" money, it took away as much gas as it needed, accumulating debts to Russia. Gazprom, interested in accessing the European market, where they paid in hard currency, paid Ukraine for transit through barter and provided it with various discounts. A "liberal market" was created in its worst form: local "elites" created numerous gasket firms that allowed them to weld on multi-stage supply chains. Barter, offsets - all this enriched those involved in the gas trade on both sides of the border.

Trading stage

With the change of power in the Kremlin at the beginning of the XNUMXs, the approaches to the gas issue also changed. In Kiev, they assessed their position as a transit monopolist between Russia and Europe and began to play this card to the maximum. The transit issue was now linked to gas supplies for Independent itself, and Kiev demanded the maximum possible preferences. A process of consolidation is under way: in Russia, Gazprom has also become a monopoly exporter so that no competitors can bring down the price, and in Ukraine influential clans of Kolomoisky, Firtash and Akhmetov are being formed, which rake up the gas issue for themselves, dispersing everyone else. The new leadership of Gazprom tried to buy out the Ukrainian gas transportation system or create a consortium for its joint management, but Kiev did not allow this, making the main pipeline a symbol of its independence. The bargaining approach of the Ukrainian authorities led to several "gas wars", when fuel supplies to discouraged European consumers were cut off altogether. Despite the absence of a contract, Kiev made an unauthorized selection of gas from the pipe, that is, it stole it banal.

Political stage

Of course, such an attitude on the part of an ordinary intermediary, which is Nezalezhnaya, is simply unacceptable. For this reason, from the end of the nineties and up to the present day, Gazprom has been implementing a program to replace Ukrainian transit. First, the Yamal-Europe pipeline was built through Belarus and Poland to Germany, then the Blue Stream pipeline to Turkey. It was followed by the first "Nord Stream" directly to Germany, bypassing transit countries. Then, after the collapse of South Stream, the implementation of the Turkish Stream began in Bulgaria. Now there is literally one last step left before the launch of Nord Stream 2. At some point, this new approach worked. In 2009, the first long-term contract was signed for the supply of gas to Nezalezhnaya and transit through its territory in a European manner. Kiev got what it wanted: a European pricing formula, where gas prices were tied to oil prices. But here, too, the Ukrainian authorities managed to "win out" a discount on gas in the amount of $ 100 per thousand cubic meters within the framework of the Kharkov agreements on the deployment of the Russian Black Sea Fleet in Crimea.

So we would have lived quietly according to European rules until 2019, but in 2014 Maidan took place in Nezalezhnaya. The "figures" who came to power as a result of the coup d'etat were extremely Russophobic and stopped paying for gas. One of the direct consequences of the coup d'etat was the return of Crimea to the Russian Federation, which in turn led to the denunciation of the Kharkiv agreements and the gas discounts they established. The price per thousand cubic meters immediately jumped up.

In 2015, Kiev announced its refusal to purchase Russian gas. The so-called "energy independence" was acquired through the transition to the purchase of Russian gas through intermediaries in the form of neighboring countries, Poland, Hungary and Slovakia. Everything returned to normal. Again, there are intermediary schemes on which "statesmen" affiliated with them make money. Knowing how much a thousand cubic meters is now on the European market, one can only grab hold of the head. But, despite the extreme disadvantage for the country, no one is going to abandon such a vicious practice. Ukraine has returned to the "nineties" again, but with much worse data than thirty years ago.

What's next? And then the story goes in a new circle. The United States, Germany and Russia are bargaining among themselves over the terms on which the transit agreement will be extended after its expiration in 2024. President Vladimir Putin spoke about this as follows:


Yes, the market situation has changed, and not for the better for Ukraine. The European Union has set a goal to reduce hydrocarbon consumption to zero by 2050. The process will proceed gradually, but incrementally. It is completely unclear exactly what volume of Russian gas will be in demand in the EU, for example, in 10 or 15 years, but it is obvious that less than now. The lower the transit volumes, the less money Ukraine will receive from Gazprom, and on the horizon of 20-30 years, these incomes threaten to be completely zero. And with what then will Kiev be left. With zero on the balance sheet.