President Zelensky’s decision not to renew a five-year contract allowing Russian gas to flow through Ukraine by pipeline to Europe joins a long list of actions by Europe and the U.S that have greatly reduced Europe’s energy security, and badly damaged its economy.
And because Ukraine is now dependent on Europe and the United States for its electricity and fossil fuel needs, including Slovakia for electricity, Zelensky’s decision will likely hurt Ukraine more than it hurts Russia.
A large and increasing amount of Russian petroleum products are being sold into Turkey and India, and then being processed and sold to the EU, so the loss of $5 billion in annual revenues (0.22 percent of Russia’s 2024 $2.184 trillion GDP) from natural gas passing through Ukrainian via pipelines will have little impact on Russia’s $240 billion per year in petroleum revenues. And given that Ukraine will lose about a billion USD (0.56 percent of Ukraine’s 2024 $189.83 billion GDP) in annual transit fees, and that the loss of gas to Europe has caused natural gas prices to soar, the question that comes to mind is whether Zelensky’s decision was more about punishing EU countries, such as Slovakia and Hungary who oppose NATO membership for Ukraine, than hurting Russia?