Contextualizing Zelenskyy’s Diplomatic Push Amid EU Energy Security Concerns
In a move underscoring the deepening intersection of geopolitics and energy strategy, Ukrainian President Volodymyr Zelenskyy is set to visit Athens on Sunday, marking a significant moment in Kyiv’s broader diplomatic outreach. The visit comes at a critical juncture for European energy security, as the European Union continues to recalibrate its supply chains following Russia’s invasion of Ukraine and the subsequent reduction in pipeline gas flows from the East. According to Greek authorities, public gatherings in central Athens have been temporarily banned ahead of the visit, reflecting both heightened security protocols and the political significance of the event.
Analysts suggest that energy cooperation lies at the heart of this diplomatic engagement. With the EU aiming to reduce its reliance on Russian fossil fuels by over 90% since 2021, alternative transit routes and regional partnerships have become paramount. Greece, strategically positioned at the crossroads of Europe, Asia, and Africa, is emerging as a pivotal player in the continent’s energy diversification framework. Zelenskyy’s visit may signal Ukraine’s intent to leverage Greece’s growing LNG infrastructure and port facilities to facilitate energy transit and potentially revive long-dormant pipeline projects.
Potential Areas of Ukraine-Greece Energy Cooperation
The most immediate area of collaboration could center on liquefied natural gas (LNG) transit and regasification. Greece has invested heavily in expanding its LNG import capacity, notably through the modernization of the Revithoussa terminal and the development of a new floating storage and regasification unit (FSRU) at Alexandroupolis in northeastern Greece. This facility, expected to be operational by late 2024, is designed to deliver up to 5 billion cubic meters (bcm) of gas annually to Southeastern Europe—an amount equivalent to roughly 10% of Greece’s total annual consumption.
Beyond LNG, discussions may also focus on reviving the Black Sea subsea pipeline concept, which was initially proposed before the war but stalled due to geopolitical risks. A revived initiative could enable Ukraine to export biogas or hydrogen produced from renewable sources via Greek terminals, integrating into the EU’s REPowerEU strategy. Additionally, joint ventures in offshore wind and solar energy projects in the Black and Aegean Seas could form part of a longer-term decarbonization roadmap, aligning with both nations’ net-zero commitments under the European Green Deal.
LNG Infrastructure Expansion in Greece: Key Projects and Capacities
- Revithoussa Terminal: Current capacity of 5.5 bcm/year, undergoing expansion to enhance flexibility and interconnectivity.
- Alexandroupolis FSRU: Expected capacity of 5 bcm/year, funded jointly by Greece, Bulgaria, and EU grants; serves as a gateway to the Balkans.
- Proposed Ionian Sea LNG Hub: Early-stage planning for a western Greece terminal to serve Italy and Central Europe.
Greece’s Ascent as a Southern European Energy Hub
Since 2022, Greece has accelerated its transformation into a regional energy nexus, supported by over €1.2 billion in EU Modernization Fund allocations and private sector investments. The country’s Interconnector Greece-Bulgaria (IGB), launched in October 2022, now delivers Azerbaijani gas to Central Europe via the Trans Adriatic Pipeline (TAP), reducing dependence on single-source suppliers. In 2023 alone, Greece exported 2.1 bcm of gas to North Macedonia and Serbia, demonstrating its growing role as a transit nation.
This evolving infrastructure positions Greece to act as a southern corridor for Ukrainian clean energy exports. Should a formal Ukraine-Greece energy deal materialize, it could include provisions for third-party access to Greek LNG terminals, enabling Kyiv to monetize future green hydrogen production. Moreover, Greece’s stable regulatory environment and participation in the EU’s Internal Energy Market make it an attractive partner for international investors eyeing midstream and downstream assets in the region.
Market Implications for Energy Infrastructure and Sovereign Debt
The prospect of enhanced energy cooperation is already influencing financial markets. Over the past six months, shares in Greece’s Public Power Corporation (PPC), which is investing in renewable integration and grid modernization, have risen 23%, outperforming the broader ASE Composite Index. Similarly, Hellenic Cables, a key supplier of submarine power and gas interconnectors, has seen its stock gain 31% year-to-date, reflecting investor confidence in Greece’s infrastructure buildout.
Sovereign bond yields in Eastern Mediterranean nations are also responding to shifting risk perceptions. Greece’s 10-year government bond yield has narrowed to 3.7% in early 2024, down from 4.5% in mid-2023, indicating improved credit sentiment tied to energy-driven economic resilience. Comparable trends are visible in Cyprus and Romania, where energy project pipelines have bolstered fiscal outlooks. However, investors should remain cautious: geopolitical volatility, construction delays, and fluctuating gas prices remain material risks that could affect returns.
Geopolitical Diplomacy Driving Next-Phase European Energy Investment
Zelenskyy’s foreign policy increasingly reflects a dual-track approach—military solidarity paired with strategic economic statecraft. His engagement with Greece exemplifies a broader trend: European energy investment is no longer driven solely by cost or efficiency, but by geopolitical alignment and supply chain resilience. The EU’s Global Gateway initiative, which has committed €3.5 billion to energy connectivity projects in the Western Balkans and Eastern Mediterranean, underscores this shift.
As countries like Ukraine seek to rebuild their economies post-conflict, energy diplomacy offers a pathway to integration with European markets. The potential Ukraine-Greece energy deal could serve as a model for similar arrangements with Moldova, Georgia, or even Türkiye, fostering a more diversified and secure European energy landscape. For global investors, this rebalancing presents opportunities in regulated utilities, renewable developers, and cross-border transmission operators—sectors poised to benefit from sustained policy support and rising demand for energy sovereignty.