A deal between President Biden and the European Union will pave the way for additional imports of liquefied natural gas from the U.S. to help replace Russian imports, Bloomberg reports.
Biden reportedly will announce the agreement together with European Commission President Ursula von der Leyen on Friday morning.
The new European energy strategy, outlined by the commission earlier this month, aims to replace 101.5B cm of Russian gas in 2022, but Russia is the EU’s biggest natural gas supplier, accounting for more than 40% of imports, and imports from the U.S. will take time to get started.
Europe is constrained by current regasification capacity and the number of terminals and interconnectors, and existing American terminals are operating at full capacity with several proposed projects still pending final investment decisions.
Bank of America analysts expect U.S. LNG exporters will begin signing deals with European buyers over the next weeks or months, but Europeans will be “careful not to over-commit themselves,” with political leaders perhaps seeing the war as a chance to increase renewable energy supplies.
A G7 statement released earlier said Europe and G7 countries would take further steps to reduce reliance on Russian energy, adding that OPEC has a “key role to play.”