Naftogaz of Ukraine

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State-owned oil and gas company of Ukraine

Last updated August 31, 2026

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Overview

Naftogaz of Ukraine is the largest state-owned oil and gas company in Ukraine, responsible for natural gas import, transit, and storage, as well as oil and gas exploration and production.

History

Naftogaz emerged from the institutional restructuring that followed Ukraine's independence in 1991. The early post-Soviet sector was fragmented among state bodies, newly licensed gas traders, regional distribution companies, and enterprises associated with oil and petroleum products. Ukrgasprom served as the principal predecessor. Weak regulation, privatization of parts of the regional distribution network, debt, and the use of energy revenues to cover public-finance obligations made the sector difficult to manage. The National Joint Stock Company Naftogaz of Ukraine was created in 1998, with Ihor Bakai and Ihor Didenko among the principal initiators identified in historical accounts. The group was intended to coordinate the country's vertically integrated oil and gas activities. It inherited domestic production, transportation, supply, and storage responsibilities, although not every regional distributor or petroleum asset was transferred into its statutory structure. Ukraine's inherited refining capacity substantially exceeded its domestic oil supply, and much of the sector was later sold or reorganized. Naftogaz retained important gas-processing, production, pipeline, and storage interests. During the 1990s and 2000s, Ukraine consumed very large volumes of gas relative to its economy. Domestic production covered only part of demand, while the balance came from Russian supplies, Turkmen gas arrangements, transit-related compensation, and later direct purchases. Outstanding debts and disagreements over prices, transit fees, ownership, and gas diversion produced repeated confrontations with Gazprom. The disputes became known as the gas wars. They included supply interruptions in the 1990s, the 2005–06 price dispute, and the severe 2008–09 crisis, during which supplies to Ukraine and flows onward to European customers were disrupted. Regulated domestic prices, costly imports, and public-service obligations contributed to substantial losses and state support during the following years. After 2014, Naftogaz pursued a more market-oriented and geopolitically independent strategy. Ukraine developed reverse-flow imports from Slovakia and other European routes, while European traders such as Statoil and Shell participated in eastward gas flows. These arrangements reduced the practical need for direct Russian imports and connected Ukraine more closely to European gas-market rules. The company also initiated arbitration against Gazprom concerning both supply and transit contracts. In 2018, Stockholm arbitration produced a net award of approximately $2.56 billion in Naftogaz's favor. The company became a symbol of Ukraine's reform agenda. Andriy Kobolyev, who took over after the 2014 revolution, was associated with efforts to reduce Russian dependence, improve governance, and challenge opaque commercial practices. At the same time, Naftogaz remained exposed to political pressure because the government controls it, household gas prices are socially sensitive, and the group manages infrastructure with national-security importance. In 2019, the company was drawn into a U.S. political controversy when reporting alleged that businessmen linked to Rudy Giuliani sought to influence its management and promote their own gas transactions. Russia's seizure of Ukrainian assets in Crimea and the full-scale invasion launched in 2022 created further legal, operational, and financial challenges. Naftogaz reported a major deficit and default-related difficulties in 2022, but later reported a return to profitability. The company continued to support domestic gas production, storage, heating, and supply while Ukraine's energy system was attacked. In October 2023, management said it would not renew the Gazprom contract after 2024. Russian gas transit through Ukraine ended on 1 January 2025. On 29 April 2025, the supervisory board appointed Serhii Koretskyi chief executive, beginning another phase in the group's wartime and post-transit strategy.

2025
Russian gas transit ends
[1]Naftogazen.wikipedia.org
Transit through Ukraine stopped when the five-year Russia-Ukraine agreement expired on 1 January.
2025
New chief executive appointed
[1]Naftogazen.wikipedia.org
The supervisory board appointed Serhii Koretskyi as chief executive on 29 April.
2022
Wartime financial crisis
[1]Naftogazen.wikipedia.org
The full-scale invasion and related market disruption contributed to a reported deficit and default-related financial difficulties.
2018
Stockholm arbitration award
[1]Naftogazen.wikipedia.org
Naftogaz prevailed in a major arbitration dispute with Gazprom concerning reduced gas transit volumes.
2014
European reverse-flow supplies begin
[1]Naftogazen.wikipedia.org
Ukraine and Slovakia launched reverse-flow gas supplies, helping reduce dependence on direct Russian imports.
2009
Russia-Ukraine gas crisis
[1]Naftogazen.wikipedia.org
A major dispute over prices, debts, and contract terms caused gas-supply interruptions affecting Ukraine and European transit flows.
1998
Naftogaz is established
[1]Naftogazen.wikipedia.org
The national joint-stock company was formed from the predecessor Ukrgasprom and related state-sector assets and responsibilities.
1991
Post-Soviet restructuring begins
[1]Naftogazen.wikipedia.org
Ukraine began reorganizing the oil and gas sector after independence, creating the institutional conditions from which Naftogaz later developed.

Products and positioning

National energy champion

Upstream energy
Natural gas production
Naftogaz produces natural gas in Ukraine through operating subsidiaries, most notably Ukrgasvydobuvannya. Domestic production is strategically important because it supports household and industrial demand, reduces import exposure, and provides resilience during wartime disruption.
Energy infrastructure
Gas transmission and storage
The group has historically operated or controlled major Ukrainian gas infrastructure through Ukrtransgaz, including high-pressure trunk pipelines and underground storage. These assets connect Ukrainian production and consumers with European markets and have supported both domestic balancing and international transit.
Energy retail and wholesale
Gas supply
Naftogaz supplies natural gas to households, public institutions, district-heating organizations, and other customers through group companies and state-directed programs. Supply operations are influenced by regulated prices, public-service obligations, and national energy-security policy.
Oil and petroleum services
Oil production and transportation
Naftogaz participates in Ukrainian oil production and operates or controls interests connected with crude-oil transportation. Its oil business is smaller than its gas activities but remains part of the group's integrated energy portfolio.
Refining and gas products
Liquefied petroleum gas and gas processing
The group produces and processes gas-related fuels, including liquefied petroleum gas, through associated production and processing assets. The Shebelinsky facility is among the best-known refining and gas-processing assets linked to Naftogaz.

Controversies

2019
Alleged attempt to influence Naftogaz management
Associated Press reporting linked Lev Parnas, Igor Fruman, and Harry Sargeant III to alleged efforts to replace chief executive Andriy Kobolyev and arrange sales of their own gas to Naftogaz. The episode became part of the broader U.S. impeachment controversy involving Donald Trump and Rudy Giuliani.
Source

2014European reverse-flow gas initiative
Ukraine · Slovakia · European Union
Naftogaz and Slovakia's Eustream enabled gas flows from Slovakia into Ukraine after Russia halted direct supplies. The initiative connected Ukraine more closely to European gas markets and supported diversification away from Russian imports.
Outcome. Reverse-flow routes became an important element of Ukraine's gas-security strategy.
Source

Brand decisions

2025
Appointment of Serhii KoretskyiOther
Background
Naftogaz required new leadership as it managed wartime energy-security duties and the end of Russian gas transit.
Action taken
The supervisory board appointed Serhii Koretskyi as chief executive on 29 April 2025.
Aftermath
Koretskyi became responsible for the group's next phase of domestic production, infrastructure, and post-transit strategy.
Source
2023
Decision not to renew the Gazprom contractStrategy
Background
The Russia-Ukraine gas-transit agreement was scheduled to expire at the end of 2024, while Russia's invasion had transformed the commercial and security relationship.
Action taken
Naftogaz stated that it did not plan to renew the contract after 2024.
Aftermath
Russian gas transit through Ukraine ended on 1 January 2025.
Source
2018
Pursuit of Gazprom arbitration awardOther
Background
Naftogaz challenged Gazprom over contractual gas-transit obligations and reduced transit volumes.
Action taken
The company pursued arbitration before the Stockholm Chamber of Commerce Arbitration Institute and obtained a favorable net award of approximately $2.56 billion.
Aftermath
The award became the basis for continuing enforcement and settlement efforts between the two companies.
Net arbitration award. $2.56 billion awarded to Naftogaz (2018)
- Gazprom — Gazprom contested the award and resisted aspects of its enforcement.
Source
2014
Shift toward European gas sourcingStrategy
Background
Russia suspended direct gas supplies amid worsening relations with Ukraine and its closer alignment with the European Union.
Action taken
Naftogaz supported reverse-flow imports through Slovakia and other European routes and pursued greater integration with European market rules.
Aftermath
Ukraine reduced its dependence on direct Russian gas purchases and strengthened links with European suppliers.
Source

Recent events

2025
Russian gas transit through Ukraine ends[1]Naftogazen.wikipedia.org
Other
Transit flows were suspended on 1 January 2025 after the five-year Russia-Ukraine transit agreement expired.
2025
Serhii Koretskyi appointed chief executive[1]Naftogazen.wikipedia.org
Leadership change
Naftogaz's supervisory board appointed Serhii Koretskyi as chief executive on 29 April 2025.
2025
Swiss court orders Gazprom to pay Naftogaz[1]Naftogazen.wikipedia.org
Lawsuit
Reference material states that Switzerland's Federal Supreme Court upheld a claim connected with unpaid gas-transit services and ordered Gazprom to pay approximately $1.4 billion.
2024
Naftogaz reports stronger 2024 results[1]Naftogazen.wikipedia.org
Other
Reference material reports net profit of UAH 38 billion, gross profit of UAH 89.1 billion and operating profit of UAH 51.1 billion for 2024.
2023
Naftogaz reports a return to consolidated profitability[1]Naftogazen.wikipedia.org
Other
Naftogaz Group companies reportedly generated UAH 23.1 billion in consolidated net profit, compared with a UAH 79.1 billion loss in the preceding year.
2023
Naftogaz says it will not renew the Gazprom contract[1]Naftogazen.wikipedia.org
Other
Chief executive Oleksiy Chernyshov stated that Naftogaz did not intend to renew the Russian gas contract after its scheduled expiry at the end of 2024.
2023
Naftogaz reports a 2023 consolidated profit[1]Naftogazen.wikipedia.org
Other
Reference material reports consolidated net profit of UAH 23.1 billion for 2023, compared with a UAH 79.1 billion loss a year earlier.
2023
Naftogaz appoints Oleksiy Chernyshov as board chairman
Leadership change
Oleksiy Chernyshov became chairman of Naftogaz’s board during the wartime restructuring of the company and the wider Ukrainian energy sector.
2022
Naftogaz defaults amid wartime financial pressure[1]Naftogazen.wikipedia.org
Bankruptcy · Other
A reported deficit of approximately $1.6 billion in the first half of 2022 contributed to a default during Russia's full-scale invasion of Ukraine.
2022
Russia’s full-scale invasion places Naftogaz operations under wartime pressure
Other · Regulation
The invasion affected gas production, infrastructure security, storage operations, customer supply, and the group’s financial position while Naftogaz continued to support Ukraine’s energy system.

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