EU Policy Chiefs Warn Against Creating New LNG Dependence

EU Policy Chiefs Warn Against Creating New LNG Dependence

Authored by Irina Slav via OilPrice.com,

The European Union is replacing one form of fossil fuel dependence with another, a group of former Brussels policy chiefs warned in a letter, cited by Reuters today.

“Simply diversifying the import of fossil fuels will only serve to maintain EU energy dependence on other countries, many of which do not respect EU values,” the authors said.

These included former Italian Prime Minister and European Commission President Romano Prodi, former climate commissioner Connie Hedegaard, and Pascal Lamy, another former commissioner and director-general of the World Trade Organization.

The European Union is currently discussing an oil embargo on Russia and looking for alternative suppliers of both crude oil and natural gas in order to wean itself off Russian fossil fuels. An embargo on Russia coal is scheduled to come into effect in August.

The United States has emerged as the biggest new supplier of gas for the European Union and oil exports are also on the rise. In fact, the Wall Street Journal reported that the EU, which has until now been a staunch supporter of spot markets when it comes to gas, is considering making long-term commitments to the U.S. LNG industry.

These commitments are necessary to make new LNG export projects economically viable but they also “saddle” buyers with a commitment to buy certain volumes for decades ahead—something that the EU has sworn it wouldn’t do as it seeks to move past fossil fuels.

The authors of the letter reminded decision-makers of that planned shift and urged them to set more ambitious emission-cutting targets and accelerate the buildout of renewable energy installations.

A massive buildout of wind and solar is also part of the EU’s plan to wean itself off Russian oil and gas. However, this buildout cannot happen overnight, forcing the bloc to seek out other replacements for oil and gas.

Tyler Durden
Fri, 05/06/2022 – 06:30

Share DeepPol