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| The Italian government is looking for ways to ease the shortage of gas reserves. (Source: TASS) |
Europe has switched to gas reserves in Ukraine in 2023 despite the risk of a military campaign in the country.
That decision has allowed energy companies and traders to draw only relatively small amounts of gas from European Union (EU) storage, keeping gas prices low and making it easier to refuel in 2024, analysts said.
Kiev is playing a key role in energy security, supplying gas to Central and Eastern Europe this winter, said Natasha Fielding, head of European gas pricing at Argus Media.
She said that calling for the use of gas stored in Ukraine helps Europe maintain high domestic reserves, reducing risks such as supply depletion due to prolonged cold spells at the end of winter.
Kiev has more gas storage capacity than any other EU country, having served as a key transit country for Russian gas exports to the bloc via pipeline.
In 2022, the 27-member bloc was plunged into an energy crisis, with natural gas prices hitting record highs in the summer as Moscow cut supplies. Ukraine emerged as an alternative storage solution for its neighbors, with EU storage reaching near capacity by mid-October 2023.
It also offers incentives such as cheap storage taxes and a three-year customs duty exemption, allowing gas to be easily re-imported into the EU as Kiev seeks further integration into the bloc's energy market.
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