The US is holding discussions with Qatar and other large gas exporters to plan contingency measures in case a Russian invasion of Ukraine disrupts supplies to Europe.
The talks with Qatar and EU member states, focused on securing additional seaborne liquefied natural gas cargoes, have gained urgency after high-level security negotiations between Washington and Moscow this week yielded minimal progress.
This has increased concerns of conflict that could hit gas supplies at a time when Europe is already facing record prices. However, officials warned that there was no “magic wand” to solve the potential shortfall with the continent already in the grip of an energy crisis.
“We’re looking at what can be done in preparation for an event, especially midwinter with very low [European natural gas] supplies in storage,” a senior US administration official said.
“We discussed what can be moved around the market, what can help . . . the things we can prepare now for deployment if and when there is an escalated crisis”.
Tensions between the west and Russia have soared as Moscow has deployed about 100,000 troops on the Ukrainian border. The US has threatened severe sanctions against Russia if it invades, while some energy officials have accused the Kremlin of already leveraging its gas exports.
Fatih Birol, head of the International Energy Agency, said last week that Russia was throttling gas supplies to Europe at a time of “heightened geopolitical tensions”.
There are fears that conflict could lead to a further drop in gas supplies to Europe, which is facing a growing cost of living crisis and rising inflation as gas prices have soared. With gas stocks at record low levels for the time of year, officials fear Europe could face industrial disruption, rolling blackouts, or even a loss of heating supplies if Russian exports fall sharply following an invasion.
The senior official in the Joe Biden administration acknowledged that existing ontracts between LNG exporters and Asian buyers could complicate efforts to divert supplies to Europe.