Gas may rise in price even more: what went wrong and what Ukrainians should expect
27 May 17:15
OPINION
In May 2025, natural gas prices in Ukraine reached a record high over the past two years, reaching UAH 23 thousand per thousand cubic meters including VAT. This is the highest level since February 2023.
Energy expert Gennadiy Ryabtsev explained to [ Kommersant] what the reason is and what will happen to the prices of “blue fuel” in the winter of 2025-2026.
He confirmed that the Ukrainian gas market is showing signs of rising costs, and industrial consumers were the first to feel it. According to the expert, the main reason is the shortage of the resource in the market caused by low gas reserves after the end of the heating season.
“The situation is very interesting now: after the winter, there is very little gas left in the storage facilities. What is being sold now is either current production or imports. But the demand remains, and it needs to be covered by something,” the expert explained.
According to him, this is the main reason why prices have risen. In particular, for business.
However, Gennadiy Ryabtsev emphasized that the situation is not yet critical:
“We cannot say that prices are sky-high. We have already gone through periods when a cubic meter of gas cost more than 40 hryvnias. So today’s prices are not the worst case scenario.
The main problem of the upcoming heating season, according to the expert, is that Naftogaz did not fulfill its plans to build up reserves for the winter, and the government ignored this situation. That is why the market was left with virtually no reserves and now Ukraine is forced to balance daily between domestic production and purchases of gas on foreign markets.
The prospects for the next heating season also cause concern for the analyst.
The filling of underground storage facilities continues, but it is slow. There is still no public answer as to where Naftogaz will get at least another 2.5 billion cubic meters of gas. There is no information about contracts or agreements,” Ryabtsev said.
When asked whether Ukraine could face a gas shortage, the expert said the following:
“There are risks. If the obligations to accumulate volumes are not fulfilled, we may well enter the winter with a shortage of resources. This means that there may be problems with the uninterrupted supply of households and industry.
It should be noted that the current situation with gas in Ukraine is not only a matter of price, but also of strategic planning. The actions of Naftogaz and the government in the coming months will determine how stable the country’s energy balance will be in the winter of 2025-2026.
Read also: European gas is getting more expensive: Ukraine may lack $2.9 billion
Gas price in Ukraine has risen to a record level: what you need to know
on May 27, EXPRO, a consulting company that focuses on the development of Ukraine’s oil and gas and energy industries, reported that gas in Ukraine was traded at prices of 22,800-23,200 UAH/thousand cubic meters (including VAT) on Monday, May 26, depending on the resource. When recalculated, the cost of gas is 19,000 – 19,333 UAH/thousand cubic meters (excluding VAT) or $458-466/thousand cubic meters or €38.15-38.83/MWh.
The main reasons for the price increase
1. Imbalance of supply and demand. In May, demand for gas significantly exceeded supply, which led to an increase in prices.
2. The government’s decision. Starting in April 2025, the Cabinet of Ministers obliged Ukrnafta to sell all its gas production exclusively to Naftogaz under PSO, and Ukrnaftoburinnya stopped selling gas on the free market.
3. Increased demand. End users and state-owned companies such as Naftogaz Trading and the Ukrainian Gas Transmission System Operator are actively building up stocks for the future, which further increases demand.
4. Decrease in storage stocks. As of May 11, gas reserves in Ukraine’s underground storage facilities amounted to only 6.02 bcm, which is 31.7% less than last year and the lowest level in 11 years.
5. Infrastructure damage. Russia’s massive attacks on gas infrastructure in February resulted in the loss of half of Ukrgasvydobuvannya’s production.
Gas prices in Ukraine and Europe
Natural gas prices in Ukraine currently exceed European prices by about €2 per megawatt-hour. However, this difference does not yet stimulate full-fledged commercial gas imports, as it does not cover full costs and margins.
Prospects for the Ukrainian fuel market
Experts believe that if the price gap between Ukraine and Europe grows further, private companies may resume gas imports to the country.
As a reminder, during the war, Ukraine has a moratorium on raising gas prices for households. The state-owned company complies with its terms.
Thus, the situation on the Ukrainian gas market remains tense, and further developments will depend on many factors, including domestic politics, infrastructure and external markets.
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