The Peter Zeihan Podcast Series Ukraine's Energy Scandal || Peter Zeihan
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Nov 27, 2025 A staggering $100 million theft from Ukraine's energy sector raises eyebrows, dating back long before current aid flows. The scandal is rooted in a Soviet-era gas transit system where corruption thrived. Wartime challenges are forcing Ukraine to shift towards privatization and efficiency, threatening old corrupt interests. Meanwhile, the fallout for President Zelensky could be significant as the nation braces for an urgent energy system overhaul amid regional shifts.
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Soviet-Era Energy Model Persisted
- Ukraine's energy system historically ran on Russian-supplied gas and a statist, throughput-focused model that tolerated corruption.
- That model rewarded volume over efficiency because managers took percentage cuts on transit and in-kind gas payments.
$100M Energy Theft Exposed
- Officials allegedly stole upwards of $100 million from Ukraine's energy sector, a scandal tied to long-standing internal corruption rather than foreign aid theft.
- Zelensky inherited this system and worked with its actors to keep the lights on during wartime, complicating accountability.
War Shifted Energy Operations Toward Efficiency
- War forced efficiency changes as damaged assets required reconstruction and private actors took larger roles in operations.
- The shift to more market-oriented operators clashed with entrenched corrupt interests who profited from high volumes.