Major gas suppliers dictating terms over green rules teach Brussels that energy security is a conditional arrangement.
The situation prompts a question the continent has long tried to avoid: what happens as the suppliers you depend on become negotiators?
The Sustainability Standoff
A direct message was sent as ExxonMobil’s CEO, Darren Woods, warned that the EU’s new Corporate Sustainability Due Diligence Directive would have “disastrous consequences.”
Qatar’s Energy Minister, Saad al-Kaabi, echoed the sentiment, telling Reuters that QatarEnergy has plans ready to halt shipments to Europe if needed.
At the heart of the dispute is a new EU law that requires companies to clean up their operations by addressing human rights and environmental problems throughout their global supply chains.
The law carries a serious penalty, with potential fines up to a portion of a company’s global revenue.
The disagreement quickly escalated to the geopolitical stage. Washington and Doha sent a joint letter to EU leaders in October, asking them to either scrap the directive or remove its most “economically damaging” parts.
They described the law as a great risk to the affordable and reliable energy that European homes and businesses depend on.
The Weight of New Dependencies
The threats carry weight. After moving away from Russian gas, the EU developed a heavy reliance on its new suppliers.
The United States provides a large portion of the EU’s gas, with ExxonMobil alone accounting for about half of all American LNG imports. Qatar supplies another large portion.
The market share gives them real bargaining power. While positioning themselves as concerned partners, their ultimatums over Europe’s internal laws are making the arrangement one of conditional supply.
Europe’s Quiet Countermove: The Green Transition
The complete context, however, includes Europe’s quiet progress in weaning itself off gas, which steadily reduces supplier leverage.
EU member states managed a considerable reduction in their gas consumption through renewable energy and improved efficiency. The portion of electricity from wind and solar grew a great deal.
Projections see gas demand dropping further by 2030. The continent’s need for gas and LNG imports could see a major decrease in the same period.
Suppliers threatening to leave might soon find themselves fighting over a shrinking pie. A falling demand could reduce the EU’s need for gas and LNG imports.
Pressure from All Sides
The pressure campaign from gas suppliers has yielded results, partly because it is amplified by powerful voices within Europe.
Swedish MEP Jörgen Warborn, who led negotiations on the directive, threatened to side with the opposition if concessions were not made.
Consequently, parliamentary committees voted to water down the law, greatly raising the thresholds for which companies it applies to.
Internal resistance is propelled by corporate lobbying. Many major European companies, including TotalEnergies and Siemens, called on leaders in Germany and France to "abolish" the bloc's new sustainability rules.
A confluence of external threats and internal resistance complicates what lies ahead.
The Strategic Direction to Energy Independence
Europe learned a painful lesson from Russia’s state-owned Gazprom, which began restricting gas flows months before the full-scale military action in Ukraine.
From one perspective, each new ultimatum from a supplier reinforces the case for accelerating Europe’s energy transition.
The steep rise in gas prices during 2024 makes renewables a smarter economic choice, especially as European industry is paying much more for power compared to global competitors.
In response, solar generation set a new record in 2024.
The situation points to Europe’s strategic direction: accepting short-term supply risks to speed up the transition that will ultimately secure its energy future.
Member states already plan to greatly expand their wind and solar capacity, putting renewables on a course to generate most of the EU’s electricity by 2030.
The leverage suppliers wield is therefore temporary, diminishing with every solar panel installed.
Time is on Europe’s side. The real question is whether its policymakers recognize the advantage before making concessions they do not need to.
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