Prospects of Russia in the European LNG Market Under Sanctions

• Main Authors: Alexander A. Boyko, Ivan E. Ilyushin
• Format: Article in Journal/Newspaper
• Language: English; Russian
• Published: Russian Academy of Sciences, Institute of Europe 2025
• Subjects: lng; sanctions; russia; eu; usa; yamal lng; gas exporter; International relations; JZ2-6530; Yamal Peninsula; Northern Sea Route
• Online Access: https://doi.org/10.31857/S0201708325010073; https://doaj.org/article/81f50846588c4085b28b16638b247985

The article examines the evolving dynamics of the European liquefied natural gas market amid sanctions and geopolitical shifts triggered by the escalation of the Ukrainian crisis in 2022. The primary objective of the study is to identify the factors influencing Russia’s position in the European LNG market and assess the prospects for maintaining its competitiveness. The research employs methods of comparative analysis, retrospective analysis of LNG import dynamics, and source analysis of data from international organizations. The European Union aims to reduce its reliance on Russian pipeline gas by increasing LNG imports, primarily from the United States, which has become the region’s dominant supplier. While Russia remains competitive due to its lower LNG prices in several European terminals, it faces significant restrictions imposed by sanctions. The differing motivations behind EU and U.S. sanctions further shape the market: the EU seeks to diversify its energy supply, whereas the U.S. aims to displace Russia from the European gas sector. Although American LNG is more expensive than Russian LNG in certain EU countries, rising domestic gas shortages in the U.S. could push prices even higher. However, political factors play a decisive role, as European nations continue to distance themselves from Russian energy despite the economic burden. Russia can strengthen its market position by achieving technological independence, expanding the Northern Sea Route, and increasing state support for the industry. A complete phase-out of Russian gas in favor of U.S. LNG poses risks to European energy security, as overdependence on a single supplier could lead to price volatility and supply disruptions. Despite mounting pressure, the European market remains a crucial destination for Russian LNG exports, offering a premium sales outlet with more favorable logistics for supplies from the Yamal Peninsula. This helps Russia mitigate its dependence on the Chinese market, where buyers hold stronger negotiating power.