(MENAFN) Western Europe's quest to replace Russian gas with liquefied natural gas (LNG) from the United States has exposed the region's energy system to significant security risks, according to industry experts cited by Bloomberg. Despite the United States only commencing shale gas exports in 2016, it has swiftly become the second-largest gas supplier to the European Union (EU), after Norway. In a pivotal development in 2023, the United States claimed the title of the world's leading LNG exporter.
The surge in LNG purchases by many European Union states in 2023 was prompted by a decline in pipeline gas flows from Russia due to Ukraine-related sanctions and the sabotage of the Nord Stream pipelines in September 2022, rendering them inoperable. However, industry insiders warn that increased reliance on United States LNG may continue to grow unless Russian gas resurfaces, and the Qataris opt not to engage in a price war for market share.
Ira Joseph, a senior research associate at the Center on Global Energy Policy at Columbia University, highlighted the potential risks associated with European dependence on United States LNG. He emphasized that changes in United States policy, exemplified by President Joe Biden's recent order for a temporary pause on approving pending and future applications for LNG exports, citing concerns over climate change, could pose a significant threat to the energy security of Western Europe.
The pause in LNG export approvals is designed to allow the Department of Energy to update economic and environmental guidelines used in the approval process. This move comes after the White House pledged to Brussels to expedite the review of applications for new export capabilities following the European Union's decision to reduce reliance on energy supplies from Russia.
As Western Europe navigates the complexities of its energy transition and geopolitical considerations, the potential implications of this dependence on United States LNG are coming into focus. The delicate balance between energy security, environmental concerns, and shifting geopolitical dynamics underscores the challenges faced by nations seeking to diversify their energy sources in an ever-evolving global landscape.
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