While Macron hugs Zelensky, France blocks Russian LNG ban
4 June 12:56
Two of the largest buyers of Russian liquefied natural gas (LNG) in the EU – France and Belgium – refuse to support Brussels’ plan to ban supplies from Moscow. The countries are demanding additional guarantees regarding the economic and legal consequences of this step, "Komersant Ukrainian" reports citing Politico.
France, which is the main importer of Russian LNG in the bloc, prefers a strategy of diversifying supplies instead of a complete ban. French Energy Minister Marc Ferracci said that the state plans to replace Russian supplies with Qatari ones.
Belgium, the second largest purchaser, requires a detailed report on the economic impact of the ban before making a decision. Belgian Energy Minister Mathieu Bie insists on an in-depth assessment of the impact of the measures on the national LNG infrastructure.
On the other hand, Spain and the Netherlands, the third and fourth largest importers of Russian LNG, are actively supporting the upcoming legislation. Both countries are interested in severing energy ties with Russia as soon as possible.
The European Commission’s plan is to ban short-term contracts for Russian LNG this year and long-term contracts by 2027. This will allow countries to withdraw from agreements that would otherwise force them to buy Russian gas for many years to come.
Last year, the four largest importers purchased 16.77 million tons of Russian LNG worth more than €6 billion. This amounted to 97% of the EU’s total imports and more than half of Moscow’s global exports.
France fears legal consequences for private companies, including possible Russian lawsuits over terminated contracts. France’s TotalEnergies is contractually obligated until 2032 and owns a 20% stake in the Yamal project in Siberia.
Belgium has to receive and store Russian LNG until 2035 under current agreements. The country plans to hold technical negotiations on the impact of the ban on its infrastructure.
Analysts note that the ban will not cause a supply crisis, as all countries can increase purchases from the United States and Canada. These countries are planning to increase capacity starting next year.
Support for the largest importers will be crucial for the European Commission, especially given the likely resistance of Hungary and Slovakia, which seek to maintain access to cheaper Russian energy.
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Europe and Russian gas
As of early 2022, the EU was 40% dependent on Russian gas. In 2021, 65% of the gas purchased by Germany was Russian. In the third quarter of 2023, only 12% of the gas imported by the EU remained Russian.
At the same time, some EU countries, such as Hungary and Slovakia, remain dependent on Russian gas. These countries’ contracts with Gazprom provide for gas supplies through the Ukrainian gas transportation system. Austria has signed a contract for gas supplies until 2040, but it has already declared that it has become independent of Russian fuel.
After both Nord Stream and the Ukrainian gas transportation system are shut down, Russia will be able to supply gas to Europe only through the Turkish Stream.
According to the Center for Research on Energy and Clean Air (CREA), since the beginning of the full-scale Russian invasion, the European Union has purchased 209 billion euros worth of energy from Russia.
How the EU is “helping” Ukraine
At the Munich Security Conference, the United States made it clear to the European Union that Europe’s security is its own problem. After that, the rhetoric of European officials for several days was filled with loud statements that it was time for Europe to wake up and finally start taking care of its own security.
In the context of the Russian-Ukrainian war, European leaders were racing to generate ideas about how they would support Ukraine and how they would help it achieve a just peace. They talked about peacekeepers (who would be in the rear), about closing the skies over Ukraine with British aircraft, about Taurus missiles, and even about the fact that a significant part of the planned 800 billion-dollar EU defense package would go to Ukraine.
A common position on peacekeepers was not reached, talks about Taurus missiles stopped, and meanwhile the EU is making decisions and taking actions that can hardly be called helping Ukraine defend Europe.
Just a few days after the Munich conference, it turned out that Belgium would hand over 30 F-16s to Ukraine not by the end of 2025, as planned and promised, but by the end of 2028. The reason was announced: The United States is delaying the delivery of F-35s, which are supposed to replace the F-16s in the Belgian military fleet. 30 F-16s are a significant number, and they could significantly improve Ukraine’s position in the sky, including a very significant boost to its air defense system. Now Ukraine cannot count on these aircraft until 2028.
Later, it turned out that the approved 800 billion euro defense package for Ukraine did not include anything special. It only mentions that Ukrainian defense companies are part of the same “pool” as European ones, and therefore the purchase of weapons from them is a priority along with EU companies.At the same time, it turned out that during the third year of the full-scale Russian-Ukrainian war, the EU spent more money on Russian fossil fuels than on financial assistance to Ukraine. During this time, the EU bought 21.9 billion euros worth of Russian oil and gas. This amount is one-sixth higher than the 18.7 billion euros that the EU has allocated to Ukraine as financial aid in 2024.
There will be no more preferential trade regime either.
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