Record Imports of Russian Liquid Gas: EU at New Highs

European imports of Russian liquefied natural gas (LNG) have reached a record high this year, despite the European Union's intentions to reduce its dependency on Russian natural gas. Despite planned efforts to completely halt imports of Russian fossil fuels by 2027, shipments to European ports have continued to rise. Data collected by Kpler shows that by mid-December, 16.5 million tons of Russian LNG were imported into the EU, an increase from the 15.18 million tons of the previous year. This represents a surprising development, explains Ana Maria Jaller-Makarewicz from the Institute for Energy Economics and Financial Analysis, as the imports were not gradually reduced as intended. While pipeline gas imports and the import of Russian oil and coal have nearly come to a standstill, deliveries of the chilled gas continue. A significant portion of the increase is attributed to higher spot market demand, according to Rystad Energy, an energy company. Approximately 33 percent of Russian LNG imports were made through spot contracts this year, compared to 23 percent last year. Multinational companies like Shell and Equinor are distancing themselves from purchasing Russian LNG on the spot market, while some traders ensure in their contracts that they do not source gas of Russian origin. Nevertheless, spot transactions have increased due to the lower prices of Russian gas, as Christoph Halser from Rystad explains, because deliveries from the Yamal terminal in Russia are much cheaper than those from the US. Despite the frigid political relations, Russian LNG imports account for 20 percent of European LNG imports this year, compared to 15 percent last year, according to ship-tracking data. Many of the imports are being redirected instead of being consumed in the EU. France and Belgium are key points for these imports, with the French port of Dunkirk in particular seeing a significant rise in arrivals. Belgium takes a leading role due to its port in Zeebrugge, an important transshipment point for Russian LNG. However, the EU is preparing measures to limit the transcontinental transshipment of Russian LNG by 2025. The EU Commission, led by Ursula von der Leyen, is considering bolstering US imports to avoid new trade conflicts with the future US President Donald Trump.