Gas market turns. Threat of supply cuts to Europe

• Qatar, one of the key suppliers of liquefied natural gas (LNG) to Europe, has threatened to limit exports to the European Union.
• Qatar's energy minister called the new regulations overly restrictive and said they could push his country to seek friendlier markets outside the EU.
• Qatar's greatest reservations are raised by the requirement to develop plans to achieve climate neutrality.

Qatar is the world's third-largest exporter of liquefied natural gas (LNG) , after the United States and Australia. Since Russia's invasion of Ukraine in 2022, it has supplied between 12 and 14 percent of European LNG.

Meanwhile, according to Reuters, in a letter to the Belgian government dated May 21, Qatari Energy Minister Saad al-Kaabi referred to the EU Corporate Sustainability Due Diligence Directive (CSDDD).

If changes are not made to the CSDDD, Qatar and QatarEnergy will have no choice but to seriously consider selling LNG and other products to non-EU markets that offer more stable and friendly business conditions, the letter reads.

A European Commission representative confirmed to Reuters that the Commission had also received a letter from Qatar. He noted that EU lawyers and member states are currently negotiating changes to the CSDDD.

Reuters recalls that Brussels proposed changes to the CSDDD aimed at easing the requirements, including:

• postponing the entry into force of the regulation by one year, until mid-2028,
• and limiting the scope of control in supply chains.

"Companies that fail to comply with the regulations may be fined up to 5% of their global turnover," we read.

Qatar has deemed the changes proposed by the EU insufficient. In the letter, Kaabi indicated that it is particularly concerned about the requirement for companies to have a climate transition plan that is consistent with the Paris Agreement's goal of limiting global warming to 1.5 degrees Celsius.

Neither Qatar nor QatarEnergy plans to achieve net-zero emissions anytime soon, the letter said, emphasizing that the CSDDD undermines the right of states to set their own national climate goals.

Qatar has proposed removing the section of the directive concerning the requirement to have climate transition plans.