US, Europe working to avoid Ukraine-related energy ‘supply shock’

The United States is working with the European Union to prevent any energy supply disruption resulting from the conflict between Ukraine and Russia, President Biden and European Commission President Ursula von der Leyen said in a joint statement Friday. 

Biden and von der Leyen said the U.S., which is the top supplier of liquified natural gas to the European Union, is working with the EU to circumvent any “supply shock” amid the Ukraine-Russia standoff.

‘We are collaborating with governments and market operators on supply of additional volumes of natural gas to Europe from diverse sources across the globe. [Liquefied natural gas (LNG)] in the short-term can enhance security of supply while we continue to enable the transition to net zero emissions,” the statement reads. “The European Commission will work for improved transparency and utilization of LNG terminals in the EU.”

The two leaders also said they remain committed to integrating Ukraine’s gas and electricity supply into the EU’s markets as the U.S. and EU work toward their respective goals on transitioning to renewable energy.

The Biden administration previously said it is working closely with other nations and energy companies for a “contingency plan” in case of a Russian invasion that hurts natural gas infrastructure.

“We’re working with countries and companies around the world to ensure the security of supply, to mitigate against price shocks affecting both the American people and the global economy,” a senior administration official said Tuesday.

Russia is the source of more than 40 percent of European natural gas, much of which flows through Ukraine. In 2021, the Biden administration lifted some sanctions on Russian entities tied to construction of the Nord Stream 2 pipeline, which was set to carry gas from Russia to Germany.

Critics said allowing the pipeline, which would circumvent Ukraine, would further isolate the smaller country from European allies. However, the administration said it had determined it would not be possible to prevent construction of the pipeline without sanctioning German and European entities as well.