EU METHANE REGULATIONS SET TO CAUSE GAS SUPPLY SHORTAGES

 

Is a natural gas supply stoppage imminent due to the EU methane regulation?

The EU has issued a regulation stipulating that, from January 1, 2027, methane emissions from the extraction, processing, and transport of crude oil and natural gas must be reduced for climate protection reasons. This is intended to apply not only in Europe but also to non-European producing countries.

The strict rules apply to importers, who must prove that these new EU standards are met in the producing countries. While importers like SEFE, Uniper, and Shell warn that “a significant portion of the global gas supply will de facto be non-compliant” and that substantial supply shortages could occur, the EU intends to enforce its regulation with exorbitant fines of up to 20 percent of annual turnover.  On June 24, the US, Qatar, Nigeria, and Algeria, in a joint letter to the EU Commission, demanded changes to the import rules, otherwise Europe would face massive supply risks in the middle of January 2027. After all, 43% of natural gas consumption in Europe is affected. US Energy Secretary Chris Wright called the rules “crazy.” The US is prepared to supply Europe, but not under these conditions.

Minister Reiche rightly advocated for a suspension of the regulation at the EU level. Her SPD colleague, Environment Minister Schneider, spoke on behalf of the federal government in favor of maintaining the EU regulation and publicly criticized his ministerial colleague for her initiative.