Oil & Gas News | U.S, EU may reach LNG supply deal

The United States and the European Union will increase LNG supplies to European countries by the end of 2022 in response to a drop in Russian gas exports under sanctions, and prepare to replace most of Russia's gas with it.

Under the agreement, Europe will receive at least 15 billion cubic meters of LNG by the end of this year, but the source of the gas has not been disclosed. In addition, European and American countries will try their best to cooperate with other international partners by 2030 and roll out to the African market. Their goal is to make the African continent abandon Russian gas supplies and opt for European and American gas supplies. As of now, Russian natural gas still accounts for about 40% of the European demand market.

"We are making a concerted effort to reduce Europe's energy dependence on Russia, and this year's 15 billion cubic meters is a big step toward that goal," U.S. President Joe Biden said at a joint news conference with the president of the European Commission.

Russia transports about 150 billion cubic meters of natural gas and 14 to 18 billion cubic meters of liquefied natural gas to European countries through pipelines every year. Even if European countries are trying to diversify their energy sources, it is undeniable that once Russia's natural gas pipelines are interrupted, European countries will have a hard time dealing with a possible energy crisis.

Speaking of the 15 billion cubic meters of liquefied natural gas mentioned above, US National Security Adviser Jack Sullivan was vague and said that no contract has been signed yet. He said the gas would come from "various sources," not just U.S. supplies.

In any case, the United States and the European Union are already actively approaching this cooperation, and Sullivan made it clear: "We are very confident that we will achieve the goal", "We want to ensure that Europeans no longer have to buy gas from Russia." In fact, the U.S. did supply a lot of LNG to Europe this year. Shipments in January had already reached 4.4 billion cubic meters, and they reached a similar level in February. After the outbreak of the Russian-Ukrainian conflict, the European Union imposed economic sanctions on Russia and reduced Russia's economic income, and also eagerly hoped to find a substitute for Russian energy. So the EU wants to replace two-thirds of Russian gas with this agreement.

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