EU agreement to get rid of Russian gas

Joint gas purchase program starts before winter

EU plans to start jointly buying gas before winter, the bloc’s head of energy policy announced earlier this week, Reuters reported. The EU is working to reduce dependence on Russian gas and build a buffer against other energy supply shocks.

Last week, the European Commission, the EU’s executive body, proposed a plan on how the EU would phase out Russia’s fossil fuels by 2027, by accelerating investment in renewable energy and saving energy. and switch to non-Russian fossil fuels.

Russia supplies 40% of gas to the EU. Since the war in Ukraine, Russia has cut off gas supplies to Poland, Bulgaria and Finland, after these countries refused to pay in cash. ruble.

The EU’s energy policy chief, Kadri Simson, told Reuters the bloc intends to start jointly buying gas this year. The EU’s joint purchase program has support from a platform the bloc launched last month. The platform aggregates the needs of countries and coordinates the use of infrastructure to import gas from non-Russian sources.

The EU’s joint purchase of gas is carried out on a voluntary basis by the countries. The plan, analysts say, could face obstacles in terms of securing a significant amount of gas from the global market as well as the complexity of coordinating companies, the government and Brussels to buy it. gas.

According to EU energy official Kadri Simson, by acting together, EU countries can access capital supplies that would not be available alone. “There is a limited amount of gas on the global market for this year. And some of that will be released on the market due to political decisions,” she noted.

The EU energy official also mentioned an agreement between the US and the EU in March on America supply an additional 15 billion cubic meters (bcm) of liquefied natural gas to Europe this year. Meanwhile, originally The EU imports 155 bcm of Russian gas per year.

Brussels said that countries should mainly use renewable and energy-saving energy to replace gas from Russia. It is expected that gas demand will decrease by 30% by 2030 in line with the EU’s climate change targets.

In the short term, however, Europe remains dependent on fossil fuels. Last week, the EU agreed to a law requiring countries to pay 80% reserve gas before winter to create a buffer against gas supply shocks.

Support for oil infrastructure in the bloc

The European Union’s proposal last week to support oil infrastructure in countries heavily dependent on Russian crude would give member states an opportunity to agree on sanctions on Russian oil. , according to the head of EU energy policy shared with Reuters on May 23.

The EC’s proposed new sanctions, including an embargo on Russian oil, earlier this month were opposed by Hungary, leading to the failure of all 27 member states to ratify it. accepted.

In a package of proposals announced last week on how the EU would phase out Russian fossil fuels by 2027, Brussels offered up to 2 billion euros ($2.1 billion) in support for oil infrastructure to help landlocked countries: Hungarythe Czech Republic and Slovakia turned to non-Russian supplies.

“The Commission really shows flexibility when it comes to allowing fossil fuel investments,” said EU Energy Commissioner Kadri Simson.

She noted that the EU reached an agreement last December to stop funding cross-border infrastructure with fossil fuels in favor of climate goals.

“This flexibility is needed to create opportunities for landlocked countries to agree to these sanctions,” she pointed out.

Hungary, which is heavily dependent on Russian oil, needs about 750 million euros in short-term investment to cope with the Russian oil embargo.

“We’re really trying to make sure that no member country faces supply security issues. This is also why we’ve added to the RePowerEU plan the list of necessary pipeline projects. will provide alternatives to landlocked countries,” Simson said. RePowerEU is the EU’s proposal to reduce dependence on Russian fuel.

Ms. Simson pointed out that during a visit to Budapest this month, European Commission President Ursula von der Leyen outlined how the EU would support the upgrade of Hungarian refineries currently designed to take in Urals crude oil. of Russia and an oil pipeline from Croatia.

Ms. Simson did not say when the bloc expected to reach an agreement on sanctions on Russian oil. On May 23, several EU governments called for an agreement to be reached before a summit of EU leaders on May 30.

While most EU countries will have to fully implement the oil embargo of Russia Within a few months of its adoption, Hungary, Slovakia and the Czech Republic were offered an exemption from the ban for a period of time.