For the first time in history, US LNG has surpassed Russian piped gas in the European Union.

IEA: The decline in Russian supply necessitates measures to lower EU demand in order to prepare for a harsh winter.

Five European countries—France, Spain, the United Kingdom, the Netherlands, and Poland—accounted for 54.1 percent of all US LNG shipments in April 2022.

For the first time, the European Union purchased more liquefied natural gas (LNG) from the United States than from Russia through pipeline in June, after Moscow restricted supplies to Europe earlier this month, according to Fatih Birol, Executive Director of the International Energy Agency (IEA), on Thursday.

“Russia’s recent steep cuts in natural gas flows to the EU mean this is the 1st month in history in which the EU has imported more gas via LNG from the US than via pipeline from Russia,” Birol tweeted today, sharing an analysis from the IEA.

“The drop in Russian supply calls for efforts to reduce EU demand to prepare for a tough winter,” the head of the Paris-based agency added.

Since the middle of June, Russia’s supply has been much reduced, and the forthcoming yearly maintenance at Nord Stream, which will entirely stop exports via the pipeline for two weeks in July, has left Europe scurrying to fill gas storage facilities to appropriate levels before the winter.

In recent months, the EU has imported record amounts of American LNG, but experts believe that LNG imports alone cannot replace Russian pipeline gas.

In April, the European Union and the United Kingdom experienced record levels of LNG imports, as higher spot prices in Europe compared to Asia enticed producers with destination flexibility to ship LNG to Europe. According to the EIA, the majority of those suppliers came from the United States.

According to figures released earlier this month by the US Energy Department, five European countries—France, Spain, the United Kingdom, the Netherlands, and Poland—accounted for 54.1 percent of all US LNG shipments in April 2022.

Despite record intakes of American and foreign LNG, economists and the IEA warn that Europe may face supply problems this winter if it does not adopt energy-saving measures.

According to Birol, Europe will be on “red alert” for gas supplies next winter.

“Recent disruptions to natural gas supplies, notably Russia steeply cutting flows to EU countries, is set to remove around 35 billion cubic metres of gas from the market this year, posing big challenges to efforts to refill storage. This is a red alert for the EU for next winter, Birol tweeted in mid-June.

Source: OilPrice

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