Russian LNG costs surge for EU amid high import reliance

The price of Russian liquefied natural gas (LNG) for the European Union surged by 150 percent in the third quarter of 2024. 

This sharp price increase comes as the EU's LNG imports from Russia rose by 20 per cent, with overall import volumes being two per cent higher than in the first quarter of 2021, Caliber.Az reports, citing Eurostat.

Despite efforts to diversify its energy sources, Russia remains a significant LNG supplier to Europe, second only to the United States, whose shipments accounted for 35 per cent of the EU's LNG imports in the same quarter.

Conversely, pipeline gas imports from Russia have plummeted by 54 per cent compared to the first quarter of 2021. However, the cost reduction for pipeline gas has been marginal, declining only by 10 per cent, highlighting persistent energy pricing challenges for the EU.

Bloomberg columnist Javier Blas recently argued that the European Union is engaging in "self-deception" by claiming it has overcome dependence on Russian gas. While Brussels has succeeded in reducing pipeline gas reliance, its growing LNG imports reveal that the EU has not entirely resolved its dependency on Russian energy.

Economists suggest that this trend reflects a broader pattern of growing bilateral trade between Russia and some European countries, driven by the EU’s continued need for specific goods from Russia. As the continent braces for another winter of elevated gas and electricity prices, questions persist about the long-term viability of its energy policies.

By Khagan Isayev