The United States and the European Union have announced an agreement on additional supplies of US liquefied natural gas (LNG) to the Old Continent as part of an effort to free Europe from Russian energy sources.
In particular, the White House said in a statement that “the United States will work with its international partners to secure additional LNG volumes for the EU market by at least 15 billion cubic meters (bcm) in 2022, with further growth expected. in the future”.
According to the White House, the long-term goal is to secure about 50 billion cubic meters (bcm) of additional US LNG supplies a year by 2030.
In the wake of the announcement, the price of European gas at the Amsterdam junction (TTF) is on a downward trend with losses of 5% and stands at 106 euros per megawatt hour.
It is recalled that Russia is the largest supplier of gas in Europe, with flows that cover about 40% of the total needs of the Old Continent.
After the Russian invasion of Ukraine and the imposition of Western sanctions on Moscow, its price jumped to 345 euros per megawatt hour, and then followed a downward trend that brought it back to the – still high – level of 100 euros and above.
Within a week, the demand of the Russian president. Putin’s payment for gas in rubles escalated the energy dispute and pushed prices up again, to more than 120 euros.
It is noted that at the ongoing EU Summit, European leaders are expected to decide on a common gas market and the creation of a security reserve ahead of next winter, in order to shield the Union from further supply shocks.
However, given that the US produces LNG to its full potential, analysts who spoke to Reuters estimate that most of the extra supplies to Europe will come from US exports to other parts of the world.
Meanwhile, the EU has already stepped up its efforts to secure more LNG, achieving a record 10 bcm deliveries in January with more than 120 ships. US deliveries that month rose to 4.4 bcm LNG, about double the usual January.
At present, Russian supplies to the EU amount to 155 bcm of gas per year via pipelines, and about 15 bcm in the form of LNG.
Source: Capital
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