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In January, wholesale gas price for households was UAH 4.65 per cubic meter or US$0.19.
Ukrainian Minister of Energy and Environmental Protection Oleksiy Orzhel says the signing of the contract on Russian gas transit via Ukraine has allowed cutting gas prices in January by 20% year-over-year.
"There were significant risks that we wouldn't be able to sign an agreement on the transmission of [Russian] gas through Ukraine to Europe. As a result, we've made it happen. This gave us an opportunity to ensure a reduction in gas prices for Ukrainian consumers by 20% January [2020] to January [2019]," he said in the Verkhovna Rada, Ukraine's parliament, on February 7.
However, the official noted a high level of depreciation of domestic energy infrastructure, which requires significant investment in upgrading. This may lead to an increase in the ultimate gas tariff.
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"It is very good that we're seeing a decrease (in gas prices) and there are necessary changes in the tariff for the infrastructure support," the minister said.
As UNIAN reported earlier, in January 2020, wholesale gas prices for households, heat producers and other protected consumers receiving gas under the terms of public service obligations will be UAH 4.65 per cubic meter or US$0.19 (VAT, retail margin, transmission and distribution costs are not included).
On December 30, 2019, Ukraine and Russia signed a new gas transit contract for a period of five years, obliging Russia's Gazprom to pump a minimum of 65 bcm of gas via Ukraine in the first year and 40 bcm in the next four years. The parties may extend the contract for another ten years.