With the current transit contract for Russian gas through Ukraine expiring at the end of this year, it's now a desperate scramble for Slovakia, Hungary, and to a lesser extent Austria to secure new deals for alternative gas, while the rest of the European Union watches from the sidelines, simply hoping that new deals don't disrupt the market. The only silver lining is that EU gas storage is pretty much full for the winter, and meteorologists are predicting a mild one.
Slovakia's move this week to cut another alternative supply deal further indicates that the country believes there will be no extension of the Ukraine transit deal. SPP has also entered into gas supply contracts with BP, Exxon, Shell, Eni and RWE to further diversify, but it comes at a high cost almost $150M more than it would have spent on Russian gas. Brussels is increasingly nervous as natural gas prices are now surging.