Ukraine received gas from Hungary ahead of halt from Russia

Energy Trade

Ukraine received shipments of 2.7 million cubic meters of natural gas from Hungary, 22.9 million cubic meter from Slovakia, and 11.0 million from Russia on Tuesday, a spokesman of Ukrainian transport monopoly Ukrtransgaz told reporters on Wednesday, after announcing a halt to natural gas imports from Russia as energy officials from the two countries could not agree on quarterly prices.

"As of today, Ukraine is not getting gas from Russia. Transit supplies are as normal," the spokesman said, referring to gas that crosses Ukraine to Europe.

Ukraine expected to receive 13.6 million cubic meters of gas from Slovakia on Wednesday.

Hungarian gas delivery company FGSZ, a unit of oil and gas company MOL, signed a new interconnection agreement with Ukrtransgaz on both forward and reverse flow across the two countriesʼ border at the end of May.

FGSZ reactivated an idle interconnector pipeline between Hungary and Ukraine in March 2013 in response to the looming Ukrainian-Russian conflict, and used it under consecutive, temporary interconnection agreements.

The capacity of the interconnector in the direction of Ukraine to Hungary is 26 bln cubic meters per year, and reverse flow capacity is 6.1 bln cubic meters per year.

Earlier, in April, Ukraine slashed its reverse flow gas imports from the West through Hungary following an agreement with Russia that cut prices.

Ukrainian and Russian gas companies Naftohaz and Gazprom agreed on April 1 that in Q2 Gazprom will sell gas to Ukraine for $248 per thousand cubic meters instead of $329 in Q1. The new price was more than $30 lower than shipments from European suppliers.

Russia has now proposed keeping prices for Q3 unchanged from Q2 with a seasonal discount of around $40 per thousand cubic meters, but Ukraine wants better terms.

Hungary renewed gas supplies to Ukraine in January after a suspension of more than three months. Previously, a daily 3-4m cubic metres where shipped through Hungary to Ukraine.

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