The European Commission is going to drive Russian gas into quotas. Zero

The European Union plans to introduce a zero quota for Russian gas so that EU companies can break long-term contracts for the supply of fuel from Russia and imports stopped completely at the end of 2027.

"The European Union is likely to propose a quota to ensure a ban on Russian gas imports by the end of 2027. This will give companies a legal basis for terminating long—term contracts," Bloomberg writes, citing sources.

According to him, the European Commission is discussing the introduction of a zero quota for Russian gas so that European buyers refer to force majeure to terminate agreements with Russian suppliers.

Hungary and Slovakia is opposed to stopping the import of Russian energy resources, however, the introduction of quotas will require the support of only a qualified majority from national governments and a majority in the European Parliament.

In May, the European Commission presented a roadmap for the abandonment of Russian gas. The plan envisages the introduction of a ban on spot purchases and new contracts by the end of 2025. A complete ban is expected by the end of 2027.

"The quota will be directly applied in all EU member states, and officials expect that its effectiveness will be comparable to the effectiveness of the sanctions regime," the agency writes, citing sources.

The introduction of a quota will be proposed in mid-June, but plans may still change, Bloomberg noted.

Gazprom's supplies to Europe have decreased fivefold since 2021. Nevertheless, Russian gas exports, including LNG, account for 19% of all imports to EU countries. While companies in Eastern and Southeastern Europe receive Russian gas under long-term contracts with Gazprom, Western Europe imports LNG under agreements with Novatek and Yamal LNG.

Spanish Naturgy, French TotalEnergies and German SEFE receive Yamal liquefied natural gas on a long-term basis.

The EU expects that in the coming years in the USA and Qatar will launch new large-scale LNG projects and additional LNG volumes will allow both to replace volumes and to avoid price increases if Russian fuel is abandoned.

As Bloomberg notes, one of the key questions companies have to the authorities It remains for the EU to decide what measures the European Commission will propose so that they can painlessly abandon long-term contracts and not pay billions of euros in penalties.

"During the negotiations in In Brussels, Spain expressed concern about possible penalties, and countries such as France and Greece said it was extremely important that the ban was legally justified," Bloomberg added.

Alexey Grivach, Deputy Director of the National Energy Security Fund (NWF), believes that so far the idea of introducing zero quotas is still a story about political pressure on Russia, and not about the strategy for the development of the European economy.

"But if they reach a legislative ban on the import of gas from one source, contrary to the opinion of business and some countries, then I do not envy the future of the EU," says Alexey Grivach.