Ukraine imports Azerbaijani gas for first time via Balkans, Naftogaz says

Ukraine's state-owned oil and gas company Naftogaz has signed its first gas purchase agreement with Azerbaijani company SOCAR. The Ukrainian company said the deal covers a small volume of gas. It did not specify the delivery schedule, Reuters reported today.

"For the first time, a test delivery of gas is also being made via the Trans-Balkan Corridor through Bulgaria and Romania," Naftogaz said.

"It is a small volume, but a strategically important step that opens the way to long-term cooperation," said Naftogaz CEO Serhiy Koretskyi.

At the end of May, the operator of Ukraine's gas transmission system said Ukraine had gained another source of gas thanks to the opening of a new route through Greece, Bulgaria, Romania and Moldova. The gas will be delivered from a liquefied natural gas (LNG) terminal near Athens via the Trans-Balkan gas pipeline. The new route has a capacity of around one billion cubic metres per year.

The initiative aims to strengthen Ukraine's energy security and reduce the risk of fuel shortages during the winter. Gas imports via this route are governed by a special mechanism intended to ensure the country avoids high transit fees.

Ukraine is now facing a gas shortage, as Russian airstrikes this year have led to a significant drop in domestic production. The country is currently importing gas via Slovakia and Hungary. Ukraine had not previously used the Trans-Balkan gas pipeline for deliveries because of high transit fees, which have since been reduced following an agreement with the transmission system operators in the countries concerned.

According to the government, Ukraine must import at least four billion cubic metres of gas for the next heating season. Some analysts, however, have estimated the required imports at more than six billion cubic metres, Reuters reported.

Relations between Russia and Azerbaijan are currently strained. Baku is demanding that Moscow admit responsibility for last year's crash of an Azerbaijani passenger aircraft, issue an apology, pay compensation and punish those responsible. The rift escalated this summer when members of the Azerbaijani diaspora were killed during police raids in Yekaterinburg. Azerbaijan, in turn, arrested several Russians, including journalists from a state-run media outlet.