Russia chokes major oil pipeline in further threat to global supplies

BRUSSELS, March 25 (Reuters) – The United States will supply the European Union with more liquefied natural gas (LNG) to help curb its reliance on Russian fossil fuels, U.S. President Joe Biden said on Friday, as EU leaders met to deal with an energy crunch triggered by the war.

The pact, announced during a visit by Biden to Brussels, follows a day of three summits in the city where leaders lambasted Russia’s invasion of Ukraine and offered fresh support to Kyiv. read more

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“We’re coming together to reduce Europe’s dependence on Russia’s energy,” Biden told reporters. “We should not subsidise Putin’s brutal attack on Ukraine.”

Russia supplies 40% of the European Union’s gas needs and more than a quarter of its oil imports.

“As you know, we aim to reduce our dependency on Russia,” EU Commission chief Ursula von der Leyen told Biden at the joint news conference.

“The U.S. commitment to provide the EU with [an] additional at least 15 bcm (billion cubic metres) of LNG this year is a big step in this direction,” she said, adding: “We are determined to stand up against Russia’s brutal war.”

However, since U.S. plants are already producing LNG at full capacity, analysts said most of the additional gas going to Europe would have to come from exports that would have gone to other parts of the world.

The longer-term objective would be to ensure, until at least 2030, about 50 bcm per year of additional U.S. LNG, von der Leyen and Biden said.

ENERGY BILLS TUSSLE

The invasion by Europe’s top gas supplier has pushed already-high energy prices to records and prompted the EU to pledge to cut Russian gas use by two-thirds this year by hiking imports from other countries and boosting renewable energy.

EU leaders will discuss on Friday what more they can to do rein in high energy bills.

“The EU is not only about big principles, big meetings and American presidents,” Belgium’s Prime Minister Alexander De Croo told reporters on arrival for a second day of a summit of EU leaders.

“Today is about the everyday issues of the people and that is the electricity and gas invoice of the people, and that’s the impact we see today of that war in Ukraine … so we need to intervene,” he said, adding that the EU should step into the energy market to reduce prices.

Spain, Greece and others will make their case for power price caps and market intervention, while a group that includes Germany and Netherlands will push back and seek to delay such moves, diplomats said.

The divisive issue of whether to impose an embargo on Russian energy, on top of the slew of sanctions already targeted at Moscow, will also come up but no decision is expected.

Those most dependent on this supply – in particular Germany – are reluctant to take a step that would have a major economic impact.

The 27 leaders will also commit to start jointly buying gas and fill storage ahead of next winter to build a buffer against further supply shocks.

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