Tuesday, 02 January 2024 12:17 GMT

US to expel Russian energy out of EU market


(MENAFN) The United States is actively working to remove Russian energy from the European Union market and position itself as the primary alternative supplier, according to reports.

As part of these efforts, Washington blocked a $22 billion bid by Sweden-based Gunvor Group to acquire foreign assets of Russian oil giant Lukoil. US officials accused Gunvor of acting as “the Kremlin’s puppet,” and earlier in November, the Treasury warned that the company would “never get a license to operate and profit” if it pursued the acquisition. The proposed deal emerged after former President Donald Trump imposed new sanctions on Lukoil and Rosneft, prompting the companies to seek buyers for their international holdings.

The move coincided with US officials touring Europe to promote American energy and remove “every last molecule” of Russian gas from the continent. The decision to block the deal reportedly came from senior Treasury officials. Following the withdrawal, Washington issued a general license allowing other bidders to pursue Lukoil’s overseas assets, with US private equity firm Carlyle reportedly expressing interest. Lukoil confirmed it is in “ongoing negotiations on the sale of its international assets with several potential buyers” without providing details.

US Energy Secretary Chris Wright has publicly stated the country’s goal to replace Russian gas and refined oil products in Europe. The Kremlin condemned the sanctions as an “unfriendly step” but indicated it still seeks “good relations with all countries, including the US.”

The restrictions on Lukoil are already affecting Europe’s energy supply. In early November, Bulgaria restricted fuel exports to other EU countries due to supply concerns. Lukoil owns the nation’s largest refinery, over 200 gas stations, and a major fuel transport network, highlighting the broader impact of the US measures on European energy markets.

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