EU imports more gas from US than Russian pipeline for first time

Despite record LNG exports from the United States, Europe will still face supply problems this winter if it doesn’t take steps to conserve energy, analysts and the International Energy Agency said. For the first time, the U.S. is supplying more natural gas to Europe than Russia is delivering via pipeline, International Energy Agency (IEA) data showed Thursday.

Europe is looking for alternatives to Russian gas supplies, such as U.S. liquefied natural gas, after Gazprom PJSC sharply cut gas deliveries to Europe through the Nord Stream pipeline and cut off deliveries to countries that don’t comply with new payment terms.

EU LNG imports from the United States have been at record levels in recent months, although analysts say imported LNG alone cannot replace Russian pipeline gas.

LNG imports from the EU and the U.K. reached record levels in April as higher spot prices in Europe compared with Asia attracted suppliers to ship LNG to Europe. Most of those suppliers are from the United States.

In April this year alone, five European countries – France, Spain, the United Kingdom, the Netherlands and Poland – accounted for 54.1 percent of total U.S. LNG exports, U.S. Department of Energy data showed earlier this month.

Fatih Birol, executive director of the International Energy Agency, tweeted on Thursday that

Russia’s recent sharp cuts in gas supplies to the EU mean that this is the first month in history that the EU imported more LNG from the U.S. than it imported pipeline gas from Russia.

The decline in Russian supplies requires the EU to work to reduce demand in anticipation of a tough winter.

The increase in LNG exports from the U.S. comes at a time when the U.S. is also boosting production of the fuel. in 2016, the U.S. began exporting LNG from the Gulf Coast. U.S. natural gas exports remain strong despite a fire at the Freeport, Texas, LNG plant, which has been closed for extended repairs.

Following the Russia-Ukraine conflict, the European Union agreed in March to add an additional 15 billion cubic meters of U.S. LNG supplies this year to replace Russian gas. To achieve this ambitious goal, the EU is trying to replace one-third of Russian supplies with LNG from various sources this year.

Russia delivers about 150 billion cubic meters of natural gas to Europe by pipeline each year, as well as 14 to 18 billion cubic meters of liquefied natural gas.

But with LNG supplies, Russia’s total gas supply to Europe is likely to remain higher than that of the United States. According to BP’s Annual Statistical Review of World Energy, Russia is the third-largest supplier of LNG to Europe in 2021, behind the United States and Qatar and ahead of Algeria.

Despite record LNG exports from the United States, Europe will still face supply problems this winter if it does not take steps to conserve energy, analysts and the International Energy Agency said.

Birol said earlier in June that Europe will face a “red alert” for gas supplies next winter.

Recent disruptions in gas supplies, particularly Russia’s drastic cutbacks to EU countries, will result in the loss of some 35 billion cubic meters of gas from the market this year, creating a huge challenge to re-stock the gas.