Think Tank Calls for EU Embargo on Russian LNG
The EU should impose an embargo on Russian liquefied natural gas imports to achieve its pursuit of banning all Russian fossil-fuel shipments into the bloc by 2027, Brussels-based think tank Bruegel said this week. The think tank said the EU "can manage" without the LNG imports, adding that the impact would not be comparable to the tremors felt from the wind down of Russian pipeline gas imports.
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Instead of pushing for a "wait-and-see" or soft sanctions approach, the report favors an embargo on Russian LNG "to reduce exposure to an unreliable and adversarial entity, and to limit the extent to which EU consumers fund the Russian state." The think tank suggested allowing purchases "only if they are coordinated via the EU’s Energy Platform, with limited volumes and below market prices," and said the policy could be "accompanied" by a price cap on "Russian LNG cargos that use EU or" Group of 7 countries' "trans-shipment, insurance or shipping services."
Bruegel emphasized that the impact would be manageable. "Impacts over the summer months should be very limited, while winter months may see marginal price increases," the think tank said. "The extent of these price increases depends on the overall tightness of the global LNG market, which determines the premium EU markets must pay to attract flexible LNG cargos."