EU energy chief warns against new LNG deals with Russia

EU countries and companies have been warned by the EU’s energy commissioner Kadri Simson stop buying Russian LNG and not to sign any new gas contracts with the country once current ones have expired. The statement came as the EU extended its ongoing attempts to reduce drastically its dependence on Russia for energy.

The EU has promised to end member states’ use of Russian fossil fuels by 2027. Last year it managed to replace some two-thirds of Russian gas with other energy sources.

Although pipeline gas flows from Russia declined, deliveries of Russian LNG to Europe increased in 2022 to 22 bcm (billion cubic metres), up from around 16 bcm in 2021, according to an EU analysis reported by Reuters.

Simson told members of the European Parliament last week that “we can and should get rid of Russian gas completely as soon as possible, still keeping in mind our security of supply. I encourage all member states and all companies to stop buying Russian LNG, and not to sign any new gas contracts with Russia once the existing contracts have expired”.

At 22 bcm, the LNG volumes were far lower than the 155 bcm of pipeline gas Europe had taken from Russia annually before the Ukraine war.

Most of those volumes were replaced with LNG from alternative suppliers such as the US, renewable energy and energy savings.

EU countries are already beginning to prepare energy supplies for next winter, which might not be as mild as the one just passed, and Simson said the Commission would propose that EU countries extend, to next winter, a voluntary target to cut their winter gas consumption by 15%.

Russia is still sending some pipeline gas to Europe via Ukraine, enough to total 20bcm this year if current flows remained stable.

There are fears that if China buys more LNG from global markets, and the winter of 2023/24 proves to be colder than average, Europe could face fuel shortages.