- The EU ramped up its purchases of Russian LNG this year, as Moscow slashes gas supplies via pipeline.
- Imports of Russian LNG totaled 15 billion cubic meters through September, up 50% from last year.
- Europe is scrambling to replace slashed pipeline flows through LNG purchases, which have allowed Moscow to pull in hefty amounts of cash.
The European Union has ramped up its purchases of Russian liquefied natural gas this year, while Moscow has slashed pipeline flows.
The EU’s imports of Russian LNG totaled 15 billion cubic meters through September of this year, up 50% from a year ago, Tim McPhie, the European Commission’s spokesperson for climate action and energy, told reporters on Friday, according to Russian news outlet Kommersant.
Still, Russia’s share of total EU LNG imports dipped to 17% from 20% a year ago, as Europe has sharply increased its purchases from other parts of the world.
The EU’s overall LNG imports soared 66% to almost 88 billion cubic meters through the first nine months of the year.
European countries have been snapping up LNG cargoes from the US and Qatar recently as they scramble to build up inventories ahead of winter while Russia slashes pipeline gas flows.
Over the summer, Moscow began cutting deliveries via Nord Stream 1, then completely cut them off last month. Then earlier this month, explosions underwater blew open leaks in the pipeline in a likely act of sabotage.
Russia still supplies some pipeline natural gas to Europe via other pipelines, but not much: flows have been reduced from 350 million cubic meters at the start of the year to 70 million cubic meters, according to the most recent estimates from Kommersant.
While LNG has helped make up for lost pipeline supplies, it comes with its own complications. LNG differs from pipeline gas in that it is largely imported overseas through tankers, and needs to be regasified before being used for energy.
Dozens of ships are circling the coast of Spain and other European countries as they wait to offload LNG cargoes, according to Reuters. The number of ships arriving outpaces the number of regasification terminals that can accommodate them.
In addition, increased LNG competition this year with Asian customers has ramped up prices and tanker rates dramatically. LNG ships now cost a record $400,000 a day, and Europe can no longer rely on cheap US LNG as supply continues to grow tight, a Texas-based LNG firm warned.
Meanwhile, Russia has been pulling in large amounts of cash through LNG sales, which are on track to reach a record high for the year, according to data from Bloomberg.