New analysis from the Institute for Energy Economics and Financial Analysis has raised concerns over Europe’s reliance on LNG, especially as the market tightens. Europe has been working diligently to wean itself off of gas as a major energy resource; however, despite the valiant efforts by the EU, gas still plays a vital role in supplying the necessary energy to the European continent. With the United States now dominating the global gas supply market, Europe will need to consider the path forward to alleviate concerns over gas and LNG supply.
The EU has been slowly phasing out its reliance on gas and LNG as an energy resource
The European Union has slowly been cutting gas demand over the past few years. Between 2021 and 2024, the EU has reduced its gas demand by approximately 20%, as well as curbing the significant gas supply from the now-sanctioned Russia.
However, this has created a new set of concerns for energy experts and analysts, as the only country capable of meeting the gas demand for the EU is the United States. By increasing its reliance on US gas, the EU may be creating a new era of geopolitical dependency in an ever-increasing, volatile market.
Following the full-scale invasion by Russia in Ukraine in 2022, the European Union has gradually reduced its gas and oil imports from Moscow. The EU bloc’s imports of Russian gas fell by 75% between 2021 and 2025. Despite these efforts, Russian gas still dominates the EU market.
The EU has been searching furiously for an alternative gas supplier
Norway has become a major gas supplier to the EU in recent years, with imports from the EU remaining consistent at around 90 billion cubic metres (bcm) annually over the past four years. While Norway provides some domestic support, the reality is that one nation now dominates the global gas and LNG market: the United States of America.
The EU may be in for a shock when approaching the US to meet its gas and LNG needs
The US has become the number one gas producer by capacity in the world, and with the current situation in Ukraine ending the generational reliance on Russian energy, the US has become a top exporter of gas and LNG to the EU bloc.
Thirteen EU nations imported gas from the US last year; some of the largest importers were France, Spain, Italy, the Netherlands, and Germany. Together, these nations accounted for 75% of the EU’s gas imports from the now-expanding US gas market.
A new trade deal between the United States and the European Union sets the stage for a new geopolitical dependence
Analysis from the Institute for Energy Economics and Financial Analysis has noted that the recent trade deal signed between the US and the EU in July of last year positions the US as the major, and only, supplier that has the capacity to meet the gas demand in the EU bloc. The EU has committed to purchasing $750 billion in US energy by 2028. With American companies salivating at the new prospects for oil production via Venezuela, the rapid expansion of the US energy sector is set to reach for the stars this year.
The EU has recently implemented a new directive to end the flow of Russian energy
With the recent statements from Donald Trump at the World Economic Forum in Davos, the EU is facing a year ahead, wrought with geopolitical challenges that will affect energy security. The European Union recently outlined a new plan to end the flow of Russian oil and gas into the bloc. While this is a positive step to apply pressure on Moscow, it has created a new scenario that will see the United States becoming the only gas supplier to the EU bloc.
