The recent capacity auctions for the Vertical Gas Corridor have underscored a significant disconnect between political aspirations and market dynamics. This corridor, intended to serve as a vital energy conduit linking Greece and Ukraine, has seen minimal engagement from gas traders, raising questions about its economic feasibility.
In the latest auction, nearly 72 GWh of transport capacity was made available for February; however, only 48 MWh was successfully booked. This figure is regarded by market participants as statistically insignificant. The limited interest was primarily observed on the route that channels gas from the Revythoussa LNG terminal and the Alexandroupoli FSRU through Bulgaria, Romania, and Moldova toward Ukraine. Notably, two alternative routes originating from Alexandroupoli—the IGB interconnector and the TAP pipeline—attracted no bids whatsoever.
Participation in this auction was notably restricted, with only a test-level submission from Metlen and one foreign trading company. This outcome reinforces skepticism among commercial players regarding the corridor’s economic justification. Such sentiments starkly contrast with official narratives that position the Vertical Gas Corridor as a cornerstone of regional energy security and a potential gateway for US LNG into Eastern Europe.
Market fundamentals have played a crucial role in shaping these developments. Ukraine, identified as the primary end buyer, is prioritizing access to the cheapest available gas. In this context, intermediaries are leaning towards alternative routes that promise better margins, particularly given the tight winter demand currently affecting the region.
Despite being classified by the EU as a priority energy project and its commitment to diminishing reliance on Russian gas, tangible support for the corridor has been sparse. EU regulators are now scrutinizing whether the auction offerings align with existing regulatory frameworks, following feedback from market participants expressing concerns over compliance.
Industry stakeholders in Greece are increasingly recognizing that achieving commercial viability for the corridor will be challenging without substantial financial backing, especially while Russian gas remains integrated into Europe’s energy supply mix. As attention shifts beyond 2027, it is anticipated that this route may take on a secondary role, particularly as other corridors approach their capacity limits. For now, however, it appears destined to function as a strategic asset with limited appeal in competitive transit markets.
