The European Union is under increasing political pressure to take on the formidable task of plugging a gap in its efforts to avoid using Russian fossil fuels: liquefied natural gas (LNG).

Following Russia’s invasion of Ukraine in February 2022, the EU imposed sanctions on shipments of Russian coal and oil by sea.

Even though there are no fuel-related sanctions in place, it has significantly reduced reliance on Russian pipeline gas. The EU’s commitment to stop using Russian fossil fuels by 2027 has been undermined by the EU’s growing overall purchases of Russian LNG.

Because the energy firms are among the biggest contributors to Russia’s budget through corporate taxes, the EU has transferred billions of dollars to Russian gas companies Gazprom and Novatek that can be used to bankroll the war in Ukraine.

About half of the LNG Russia shipped in the first ten months following its invasion of Ukraine, according to analysts at CapraView, a global gas forecasting organisation, is believed to have flowed to Europe, generating about $14 billion in income.

Russian LNG imports rose to 22 billion cubic metres (bcm) last year from 16 bcm in 2021, according to an EU report. Whilst certain nations have witnessed a large increase since the war, those levels are much lower than the 155 bcm of pipeline gas the EU used to import from Moscow each year.

In the 12 months following Russia’s invasion of Ukraine, imports of Russian LNG by Belgium and Spain virtually doubled, according to Kpler data.

The 27-member European Union is becoming more eager to confront the problem, but there is no consensus on how to proceed because there is a significant risk of raising energy prices and unintentionally increasing Russian energy earnings.

Kadri Simson, the EU’s energy commissioner, called it a “reputational risk” last month for EU member states and corporations to continue importing Russian LNG while the EU brags about its efforts to reduce payments to Russia.

Teresa Ribera, the energy minister for Spain, requested from Spanish purchasers not to sign any new Russian LNG contracts last month. But, she warned that in the absence of sanctions, EU businesses who ceased importing Russian LNG risked being penalised for breaching their existing contracts.

Ribera told Reuters, “I think it should be discussed in a punishment package, since otherwise the situation is rather silly.

“It’s true that overall, there isn’t much of a difference. Yet, I don’t think it’s simple to explain why we continue to accept these LNG imports, she added.

Some EU members are considering alternatives due to the political difficulty of enacting sanctions, which call for unanimity.

Members of the bloc requested last week that countries be given the legal right to prevent Russian companies from reserving the infrastructure space required to transport LNG to Europe.

The plan must be worked out with the European Parliament and is a component of a law that has more comprehensive regulations for the EU petrol markets. The Parliament wants to go a step further and has recommended a complete ban on all gas imports into the EU from Russia.

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