Ekaterina Girnyk12:30, 12.11.23

The move could cause disruption to global energy markets.

This is the first time the US has directly targeted Russia’s ability to export liquefied natural gas , a move that could cause disruption to global energy markets, the Financial Times writes .

It is noted that European countries continued to import Russian LNG even after the full-scale Russian invasion of Ukraine, and until recently the United States sought to avoid disrupting supplies so as not to increase pressure on its allies.

However, in early November, the US State Department announced sanctions on Russia’s new Arctic LNG 2 project, essentially blocking European and Asian countries from buying gas from the project once production begins next year. It is noted that this is the first time that US sanctions directly affected LNG supplies.

The project was expected to begin delivering LNG to the international market in the first quarter of 2024. Market analysts say these volumes could help ease some of the tension in the global LNG market caused by increased demand in Europe.

At the same time, US sanctions will actually block this project for Western buyers.

It is noted that US sanctions are not directly aimed at other large Russian LNG projects – Yamal LNG and Sakhalin-2, which supply fuel to Europe and Asia.

“Arctic LNG-2” – what is known about it

It is noted that Arctic LNG-2 is located on the Gydan Peninsula in the Arctic, which will allow it to export gas to both the European and Asian markets. It will be Russia’s third large-scale LNG project and, when fully operational, will provide a fifth of Russia’s target of producing 100 million tonnes of LNG per year by 2030, more than three times the amount the country exports now.

Arctic LNG 2 is led by the Russian private company Novatek, which owns 60 percent of the shares. Other shareholders include France’s TotalEnergies, two Chinese state-owned companies and a Japanese joint venture between trading house Mitsui & Co and government-backed Jogmec, each holding a 10 percent stake.

Europe and Russian gas

The European Union plans to import record volumes of liquefied natural gas from Russia this year   , even as the bloc aims to phase out Russian fossil fuels by 2027.

 Gas storage capacity in Europe has now reached 96% , achieving an important goal to ensure the EU’s energy sustainability during the winter season.

(C)UNIAN 2023