TurkStream on the diversifying south-eastern European gas market. OSW Commentary Number 388 8.04.2021.

Łoskot-Strachota, Agata and Seroka, Mateusz and Szpala, Marta (2021) TurkStream on the diversifying south-eastern European gas market. OSW Commentary Number 388 8.04.2021. [Policy Paper]

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Abstract

December 2020 saw the completion of another part (Bulgaria–Serbia) of the European section of the TurkStream gas pipeline, through which gas has been exported from Russia to south--eastern Europe since January 2020. The capacity of the entire route is not yet being fully used, but it has already reduced Russia’s dependence on transit via Ukraine. In 2020, around 12 bcm of gas was sent via TurkStream instead of Ukrainian pipelines: half to Turkey, and the rest to Bulgaria, Greece and North Macedonia. Ultimately, the pipeline will also transport gas via Serbia to Hungary, Austria and Romania. The rapid implementation of the entire project, in a region where infrastructure investments usually take a long time, represents a success for the Kremlin. Neither the economic challenges linked to the COVID-19 pandemic nor the political opposition of the US to new links between Europe and Russia (which mainly strikes at the Nord Stream 2 pipeline) have got in the way of the project’s completion. However, TurkStream will not stop the changes happening on the south-eastern European gas market, many of which are unfavourable for Russia. Some of them may paradoxically even be accelerated due to TurkStream’s launch. In recent years, infrastructure has been developed which enables the region’s countries to diversify their gas supply sources and routes, including Azerbaijan or (in the form of LNG) the USA and Qatar. Additionally, the launch of TurkStream has freed up large capacities of trans-Balkan gas pipeline, as well as those running along the Ukraine–Hungary–Serbia route, all of which can be used to deliver gas supplies from outside Russia.

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