Azerbaijan could export gas through Ukraine after Russia deal expires.

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Ukraine and the EU have discussed the possibility of Azerbaijan supplying natural gas to Europe via Ukraine once an existing contract with Russia expires at the end of 2024, President Ilham Aliyev said. All sides -- including Ukraine, the EU, and Russia -- are interested in continuing gas transit, Aliyev said at a conference on July 20 in the city of Shusha, Bloomberg reported.   "We will help if we can," he said. "I think it's possible to prolong this deal."

Kyiv is in talks to transit gas from Azerbaijan to the EU after the contract expires as it looks to continue being a transit country to Europe to help ensure the energy security of its western neighbors, President Volodymyr Zelensky said in an interview with Bloomberg on July 3. "Alternative steps are being considered now on how we can use the pipeline with another gas supplier, another country. Negotiations are underway," Zelensky said.

"We don't want to extend the gas contract with the Russian Federation. We don't want them making money here," he added. Transiting gas from Azerbaijan instead is "one of the proposals," Zelensky said.

According to Bloomberg, Ukraine earned around £1 billion from transit revenue in 2021, and therefore continuing to use the extensive system of pipelines "would help provide crucial funding for the war-torn economy." Despite efforts by European countries to reduce dependency on Russia's gas, Russian supplies remain an important part of the EU's imports. Russia cut much of its pipeline gas transit to Europe in 2022, but countries like Austria, Hungary, and Slovakia remain heavily reliant on Russian imports.

Those countries could be in "serious trouble" if Russian gas transit to them through Ukraine stops, Aliyev said, adding that they would have to pay "hundreds and hundreds of millions" more to purchase gas from elsewhere. Aliyev also said that Azerbaijan is planning on increasing gas production in the Caspian Sea with both new and existing projects. European Commission President Ursula von der Leyen signed a deal with Aliyev in Baku in July 2022 to bring imports of Azeri natural gas to "at least" 20 billion cubic meters annually by 2027.

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