The European Union Agency for the Cooperation of Energy Regulators (ACER) has published its European LNG Market Monitoring Report (MMR). According to the report, the EU outpaced China as the largest global LNG importer in 2023, with 134 bcm of LNG imports recorded, while the United States have surpassed Qatar and Australia as the largest LNG producer, with an estimated export volume of 119 bcm in 2023. The EU’s increased demand of LNG may reach its peak during 2024 under ‘REPowerEU’ demand scenarios, at 330 bcm.
The report also revealed that despite the EU members efforts to temporarily limit gas supplies, particularly from Russia and Belarus, substantial volumes have already been contracted under long-term LNG agreements before the Russian invasion of Ukraine. Since the current ship-or-pay transit contract for gas pipeline supply from Russia to Europe via Ukraine is set to expire by the end of 2024, about 13.6 bcm of natural gas supply compared with the flows in 2023 may be loss if the contract is not renewed. To reach the EU's target to end its reliance on Russian fossil fuels by 2027, ACER recommends to consider the reduction of Russian LNG imports in gradual steps, starting with spot Russian LNG imports.
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