Exclusive Winter challenges: what gas prices can we expect, and will there be enough resources?

Gas prices in Ukraine and the EU are currently stable, with no shortage in sight

Ukraine is entering the 2025/2026 heating season amid unprecedented Russian attacks on gas and gas production infrastructure. At the end of October, 13.2 billion cubic meters of gas had been stored in underground gas storage facilities, but we will still need additional volumes of imported gas to get through the winter without disruption, in order to compensate for partial losses in domestic production due to the autumn attacks.

Gas prices – on a plateau

As of the end of October, according to Gas Infrastructure Europe, European storage facilities are more than 82% full, although the EU emerged from last winter with record low reserves of 33.5%. This was an alarming signal, so it was necessary to work proactively to prevent speculation in the market. As predicted, thanks to the easing of stockpiling measures and increased LNG supplies, Europe managed to avoid high volatility and excessive prices during the injection season and, in particular, on the eve of the autumn-winter period (AWP).

In September-October, the European TTF benchmark remained at a plateau of approximately $400 per thousand cubic meters with controlled daily volatility. The average September spot price was $398, or 16,449 UAH per thousand cubic meters, and futures for the month ahead were $402, or 16,629 UAH. In October, the situation remained virtually unchanged: the cost of the resource is still below $400. An interesting fact: while in September the monthly contract was slightly more expensive than the spot price, in October it was the opposite.

The cost of gas in the first month of autumn fluctuated within 6%, and in October – 9%. This indicates the absence of a “price rally” before the start of the heating season in Europe.

The situation on the Ukrainian market is also stable, but we are seeing moderate growth in the second half of October. This is traditionally influenced by colder weather, the start of gas withdrawal from storage facilities, and the seasonal approach of consumption peaks. This year, there was also a short-term shutdown of the Polish corridor on October 20–23, as well as an increase in imports due to recent attacks on gas production infrastructure. While in September the cost of gas was UAH 20,000 per thousand cubic meters, by the end of October, quotations for November had risen to UAH 21,000–21,500.

As we can see, prices for this resource are currently stable and understandable in both the EU and Ukraine. There are no signs of a shortage, and the price on the TTF hub is holding steady without any abnormal spikes. Given that Ukraine has successfully pumped resources into underground gas storage facilities during the off-season, the accumulated reserves and available capacity for further imports should not lead to significant price spikes.

What to expect in the coming months?

Currently, spot and futures contracts are almost equal, which allows us to predict that prices will remain stable with only moderate seasonal fluctuations until the end of 2025. There are several factors that may affect the cost of resources in the EU: weather in the northern and central parts of the continent, as well as competition for LNG on the global market.

For Ukraine, there are also local reasons that add to the European price. These could be temporary technical restrictions at inter-state crossing points, continued attacks on gas infrastructure, and the euro/dollar exchange rate against the hryvnia. Given these risks, sellers usually set a slightly higher price for the resource to cover the risks.

The cost of gas on the European TTF hub in November-December is expected to fluctuate between $370-430 per thousand cubic meters, which is equivalent to 16-18 thousand hryvnia. In addition, delivery to Ukraine must be added, which is almost €50 per 1,000 cubic meters, mandatory VAT – another 20% of the cost, and other expenses. In the event of a severe cold snap, a short-term price increase of up to 2,000 hryvnia is possible, and with warming, a similar decrease.

Gas availability in the EU will ensure supplies to Ukraine

Europe is entering winter with a relatively comfortable safety cushion, with LNG playing a key role in balancing the market. Under the baseline scenario — moderate demand, no extreme cold weather, and stable supplies of liquefied gas—the EU will emerge from the 2025/2026 heating season with underground gas storage reserves above 30%. In more critical scenarios, LNG purchases will have to be increased and consumption reduced. This, in turn, will push prices up and further reduce underground gas storage stocks in the spring of 2026.

International analysts predict that Europe will need to import up to 160 additional LNG shipments this winter. Imports of liquefied natural gas will increase from 660 tankers in 2024 to 820 this year (one ship carries an average of 100 million cubic meters), which will account for almost 50% of all gas supplies to the European Union.

The sufficient amount of resources in the EU makes it possible to predict stable supplies to Ukraine. We have more than 70 million cubic meters of guaranteed capacity per day for imports. The main routes are Hungary, Poland, and Slovakia, which provide 97% of the total volume of supplies. There is also the possibility of receiving resources from Romania and Moldova. Previously, the tariff for gas transportation through these countries via the Trans-Balkan corridor was more than twice as high as other routes, but now there have been positive changes.

Recently, Moldova’s regulator ANRE introduced a 50% discount for gas transportation via Route 1 of the Trans-Balkan gas pipeline, through which Ukraine can import resources from Greek LNG terminals. Operators Vestmoldtransgaz and Romania’s Transgaz will apply the reduced tariff for six months, from November 2025 to April 2026.

As we can see, this decision has already yielded results: at the last auction, most of the transmission capacity since the launch was reserved. According to the Regional Booking Platform, gas network operators in Southeast Europe offered approximately 2 million cubic meters per day in November, of which one-third was reserved. It is possible that part of this volume could have gone to Ukraine.

The government and Naftogaz are now actively working to diversify supplies and purchase additional gas volumes to ensure stable winter gas supply. Work is underway to expand transmission capacity on the Polish route, and opportunities to reduce tariffs on the Slovak route are also being discussed.

The main issue for Ukraine is not so much the resource itself, as it is unlikely to be difficult to find in Europe, but rather the cheap logistics of delivering it to our underground gas storage facilities.