Romania braced for peak winter gas supply shortfall if no Ukraine transit exports

Author: Aura Sabadus


LONDON (ICIS)--Romanian gas companies are braced for supply shortfalls this winter if they cannot secure any volumes transited via Ukraine during peak demand.

Concerns are evident in the wide price spread between the Romanian Q1 ’22 and the Dutch TTF equivalent contract.

The Romanian Q1 ’22 is currently trading at New Lei 467.15/MWh (€94.13/MWh) on the energy exchange BRM, putting it at a €11.13/MWh premium over the ICIS TTF Q1 ’22 assessment on 11 October.

The spread was even wider on 6 October when the contract soared to €144.26/MWh on BRM, €38.26/MWh higher than the Dutch TTF price assessed for the product that day.

Traders say there is growing concern about peak winter supplies particularly if Romania cannot secure imports via Ukraine.

“Gas demand on normal [demand] days would be anywhere between 58-60million cubic metres/day,” a trader said.

“Some volumes would come from local production and storage, others would be imported from Hungary and Russia.

“However, the situation may change if we were to have peak demand over a consistent period of time. Consumption may increase by another 10-15mcm/day, and this is where things become uncertain because we don’t know where the extra volumes could come from,” he said.


Romania has traditionally relied on Russian gas supplied via the Mediesu Aurit and Isaccea border points with Ukraine to cover rising demand during the cold period.

However, Russia diverted the transit of gas through the Trans-Balkan line which had historically linked Ukraine to Romania and the Balkans to the new TurkStream corridor linking Turkey to Bulgaria.

The trader said the odds of securing gas via TurkStream were small since supplies have been fully contracted by consumers in the Balkan countries and Hungary.

This means that Romania would be left with only two options: Hungary and Ukraine.

Romanian companies have been importing gas from Hungary but the Csanadpalota border point is congested, limiting Romania’s ability to import gas, particularly during peak demand.


The Ukrainian border capacity is ample but companies may not be able to import volumes on two accounts.

Firstly, it is unclear whether Russia would increase volumes shipped via Ukraine and revive the transit along the Trans-Balkan pipeline.

Earlier in October, president Vladimir Putin said Russia had already shipped 8% more than the contracted 40 billion cubic meters/year as part of a five-year transit deal with Ukraine, hinting at the possibility that volumes may not increase further via this route until the end of the year.

Ukrainian government officials have strongly rejected the statements, reminding that compared with 2020, when Gazprom was contractually expected to transit 65bcm/year, the volumes have in fact decreased by 17%, contributing to an overall supply shortfall to Europe in the first nine months of 2021.

If Russia does not intend to increase the gas transit via Ukraine or, indeed, seeks to divert it completely to Nord Stream 2 if the pipeline is commissioned shortly, Romania, just like Ukraine, may face an acute supply shortfall.

If the Russian transit continues or even increases via Ukraine during winter, Romania could access gas via the Isaccea IP linking southern Romania to Ukraine’s southeastern Odesa region.

However, this may still be a limited option for Romania.

This is because the Romanian transmission system operator Transgaz has so far postponed signing an interconnection agreement with Ukraine to allow flows at the Mediesu Aurit border point linking northern Romania to southern Ukraine. The point is critical to supplies in northern Romania where pressure in the local grid tends to be low.