Blocking all types of gas contracts with Russia is the imbecility and courage of the European Commission

Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented on the prospects and consequences of the proposed ban on contracting Russian liquefied and piped gas in the EU to the Neft and Capital Internet portal.

As Alexey Belogoryev noted, this is a big problem for Russia. Our LNG plants are initially focused on the European market. If it closes, the Russian Federation will face great risks of reducing exports for 2-3 years and an obstacle to launching new capacities (new lines at the Arctic LNG 2 project).

According to Alexey Belogoryev, Europe will be able to replace Russian LNG no earlier than the second half of 2026. By the way, limiting supply, if the EC blocks gas from the Russian Federation, will also increase the average cost of LNG. This is despite the fact that any replacement of pipeline gas from the Turkish Stream in the form of LNG (no matter from where) will also be clearly more expensive.

"It is difficult to say today how much the price of LNG will rise in this scenario. But it will definitely be an artificial increase. Hungary and Slovakia will be against the ban on long-term pipe contracts. Austria will be unhappy (albeit not publicly). In general, neither the EU states nor companies from the region have any benefit from canceling contracts with the Russian Federation (and in the spot market too). The decision is purely political," concluded the expert.