EU to ban Russian gas imports by 2027, seeks U.S. LNG boost
The European Union plans to implement a ban on the import of Russian gas — both pipeline and LNG — by the end of 2027. New contracts and spot purchases are set to be blocked as early as 2025. Meanwhile, discussions are ongoing about increasing LNG supplies from the U.S. and Qatar, Bloomberg reports.
Although gas imports from Russia significantly decreased after its invasion of Ukraine, in 2023, they still accounted for 19% of deliveries to the EU. Previously, this share exceeded 40%. The main issue arose with Russian LNG, which reached record levels on the European market after Gazprom limited pipeline deliveries.
According to the European Commission's announcement, the plan aims for a gradual phase-out of Russian gas. New contracts and spot transactions, meaning one-time deliveries, are to be banned by the end of 2025.
By the end of 2027, the ban will include long-term LNG import agreements, which are currently active based on so-called "take or pay" clauses and are difficult to terminate.
The success of the plan depends on whether the EU can secure alternative supply sources. Contracts with the U.S., Qatar, Canada, and African countries are under consideration. The issue of increasing LNG exports from the U.S. to Europe is being discussed in trade talks with Donald Trump's administration, Bloomberg reports.
According to EU sources, the planned restrictions should not significantly affect gas prices or threaten energy security. A large amount of new LNG is expected to enter the market in the coming years, which may mitigate the embargo's effects. The final version of the plan is to be announced in June.
The U.S. wants to be a gas powerhouse
Recall that according to Donald Trump's plans, America is set to become an energy powerhouse. By changing the law on his first day in office, he unlocked the potential for increased extraction and the construction of new gas fields and terminals. The U.S. intends to double its current LNG production by 2030. However, it needs new contracts to strengthen its market position.
To achieve this, Trump employs both threats and pressure. By imposing exorbitant tariffs on almost the entire world and then suspending them for 90 days, he signaled that countries should use this time to present an offer that satisfies the U.S. Key agreements will involve contracts for gas, armaments, or raw materials.
The demands of the U.S. president are constantly growing. The European Union assured that it is willing to increase purchases of American LNG at the expense of the volumes currently imported from Russia. A few days ago, Ursula von der Leyen assured that an energy partnership with the U.S. is strategic for Europe.
On Thursday, the head of the European Commission recalled that the United States promptly provided liquefied natural gas (LNG) during the energy crisis triggered by Russia’s 2022 invasion of Ukraine.
