Complete abandonment of gas from Russia: the European Commission doesn't have the guts

Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented to Neft and Capital magazine on the feasibility of the EU abandoning spot purchases of Russian LNG by the end of 2025 and a complete ban on Russian LNG supplies by the end of 2027.

According to Alexey Belogoryev, a problem in monitoring and tracking Russian LNG may arise if LNG is transshipped in third countries and supplied under the guise of gas from these states. However, unlike oil cargo, there is no such practice in the world today.

“If the blue fuel goes directly from Yamal LNG, then such a supply is, of course, easy to track. LNG vessels are clearly visible, there is no shadow fleet of such tankers in the world. In general, the European Commission's idea of monitoring LNG supplies from the Russian Federation is feasible, difficulties can arise only because of traders," the expert explained.

According to Alexey Belogoryev, it is theoretically possible to find the amount of LNG that Russia sold to Europe on the spot. But the problem is that by that time, the European Union will need to increase purchases of liquefied natural gas by about 20 million tons, and the entire increase in supply on the market will cover this demand. But with the replacement of the volume that will fall due to the refusal of purchases from the Russian Federation, difficulties may arise. Everything will depend on the demand for gas in the European Union during the winter period.

"The EC's decision to abandon spot purchases from Russia by the end of 2025 is clearly premature. Any negative weather conditions will lead to an artificial reduction in supply, and this is a direct path to a sharp increase in gas prices in the region. It would be more logical to abandon sometime in April 2026, rather than at peak times of gas consumption. Unfortunately, the decision is political in nature," the expert concluded.