The European Commission postponed publishing a plan to phase out Russian fossil fuels originally scheduled for March 26, causing a brief drop in European gas prices as traders digest possible explanations for the move.
The bloc has been progressively moving to wean itself off Russian energy by 2027, with gas supplies from Moscow being replaced with liquefied cargoes since the Kremlin unleashed its war in Ukraine three years ago. More recently, speculation that a nearing end to the war could return some flows to Europe has pushed prices lower.
The commission didn’t explain why the phaseout plan was removed from a schedule published Wednesday, and didn’t immediately respond to a request for comment. No new date for publishing the document has been specified. European gas prices tumbled as much as 4.2% before reversing losses.
“If the EU is delaying its roadmap on how to phase out Russian gas, it’s possible that the original phase-out deadline of 2027 itself could also slip,” said Tom Marzec-Manser, an independent gas analyst. “The US is taking a transactional approach to its foreign policy, so it would not be implausible that Russian gas and LNG supply are part of any agreement to bring the war to an end.”
European gas prices have been prone to sharp swings recently as economic and geopolitical uncertainties mount. Higher fuel consumption this winter and the end of a transit deal between Russia and Ukraine have intensified the challenge of replenishing Europe’s gas stockpiles, which dropped to the lowest since 2022.
While pipeline gas supplies from Russia cover less than 5% of Europe’s fuel needs after most major routes have been closed since 2022, the nation remains the second largest supplier of LNG to the EU. Purchases hit a record last year, with Spain, France and Belgium being the biggest buyers.
“The delay to the publishing of the roadmap is no surprise as Europe is still heavily reliant on Russian LNG and getting rid of any gas in the middle of tariff negotiations with the US puts Europe in a difficult position,” said Florence Schmit, an energy strategist at Rabobank.
With assistance from Priscila Azevedo Rocha.
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