While Russia and Ukraine are interested in a natural gas transit agreement allowing continued gas deliveries to Europe, a deal would require the involvement of Azerbaijan or another third party and faces significant commercial, political and tactical constraints that make it ultimately unlikely by year's end. On Dec. 31, Ukraine's natural gas transit agreement with Russian state-owned gas giant Gazprom will expire. The five-year deal is set to deliver around 15 billion cubic meters (bcm) of gas to buyers in the European Union in 2024, though these flows through Ukraine now account for less than 5% of the Continent's gas supplies. Ukraine does not intend to renew the agreement but is negotiating with Azerbaijan and European buyers for an alternative deal with Gazprom, which would likely involve gas swaps, to keep around 10 bcm per year of gas flowing. Specifically, Ukraine's government is pursuing a commercial contract with Azerbaijan's state...
