The European Union's push for…
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A sharp increase in U.S. liquefied natural gas exports to alleviate a tight supply market in Europe has come under fire for its environmental effects.
As a result, the boost in exports has slowed down, Reuters has reported, citing unnamed sources from Washington and the energy industry.
Europe has become the biggest market for U.S. liquefied natural gas over the past three months after gas prices on the spot market rose to record highs, making U.S. LNG competitive for European buyers.
Prices have continued to break records, especially after the Russian invasion of the Ukraine, and U.S. LNG has continued to flow at record rates, even sparking concern that the available LNG import and storage space in Europe would soon be unable to handle the flows.
Yet, at the same time, environmentalists have voiced concern about the environmental footprint of these exports.
Earlier this month, a coalition of as many as 120 progressive non-governmental organizations called on the six largest U.S. banks to stop financing the expansion of LNG export facilities and the construction of new ones.
Now, according to the Reuters sources, the White House had shelved an interagency review on how to boost LNG exports to Europe further. The decision followed opinions expressed by some in the administration, who said such a move would go against the White House’ energy agenda, which has prioritized the reduction of fossil fuel use.
Currently, the European Union gets about 40 percent of the natural gas it consumes from Russia but it wants to cut this dependence by as much as two-thirds by the end of this year. U.S. LNG—and LNG from other sources—is a key element in its urgently revived gas supply diversification push.
The U.S., for its part, has been exporting more than half of its LNG to Europe amid favorable market conditions, and LNG producers are planning a major ramp-up in export capacity.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.