US Overtakes Russia as EU No2 Gas Source

The United States displaced Russia as the European Union’s second-biggest natural gas supplier in the first quarter due to the expiry of imports of Russian pipeline gas via Ukraine at the start of the year, the European Commission has reported.

The 27-member bloc imported a total of 69 billion cubic meters (2.44 trillion cubic feet) of gas in the January-March period, down two percent quarter-on-quarter and year-on-year. Pipeline gas accounted for 55 percent or 38 Bcm while liquefied natural gas (LNG) contributed 45 percent or 31 Bcm, according to the Commission’s latest quarterly gas market report.

The volume of EU pipeline imports fell 14 percent against the prior three-month period and 10 percent compared to the first quarter of 2024 thanks to the end of the Ukraine-Russia transit deal. On the other hand LNG imports rose 18 percent quarter-over-quarter and 11 percent year-on-year.

Norway remained the EU’s top gas – gaseous and liquefied – supplier, accounting for 31 percent or 21.7 Bcm. U.S. volumes comprised 24 percent or 16.6 Bcm, followed by Russia at 14 percent or 9.7 Bcm. North Africa came fourth at 13 percent or 9.2 Bcm, followed by Qatar at five percent or 3.2 Bcm and Azerbaijan at four percent or 2.6 Bcm.

Russia’s share of total EU gas imports dropped five percentage points to 14 percent quarter-on-quarter. Russian volumes, both pipeline and cargo, dropped 28 percent against the prior three-month period and 27 percent compared to the first quarter of 2024.

Russian pipeline gas imports decreased 45 percent quarter-on-quarter to 4.6 Bcm and 39 percent year-on-year.

“The gas market report confirms that further progress was achieved in the diversification of EU gas supply away from Russia and the structural change in imports”, the Commission said in a separate statement.

However, Russia was still the third-biggest source of EU pipeline gas with a share of 12 percent or 4.6 Bcm. It was overtaken at second place by North Africa, which has a 21 percent share or 7.9 Bcm. Norway remained the EU’s biggest pipeline gas supplier accounting for 55 percent or 20.6 Bcm.

Meanwhile Russian LNG imports were practically unchanged (5.1 Bcm, +0.6 percent) quarter-on-quarter and down 11 percent year-on-year, retaining its position as the EU’s second-biggest LNG supplier with a share of 16 percent or 5.1 Bcm.

“This change also further accentuated the shift towards more LNG imports (45 percent – relative to 38 percent in the previous quarter), while pipeline gas imports were reduced (55 percent, from 62 percent in Q4-2024)”, the statement said.

The U.S. remained the EU’s top LNG supplier, accounting for 53 percent or 16.6 Bcm. Behind Russia was Qatar at 10 percent or 3.2 Bcm.

Last month the European Commission proposed legislation to stop the importation of gas, oil and oil products from Russia by 2027, betting on global LNG and increased regional infrastructure interconnectivity.

Increased Demand

The EU consumed 119 Bcm in the first quarter, up eight percent or 8 Bcm year-on-year, “indicating an end of the continuous contraction in European gas consumption experienced since 2021”, the report said.

“Quarter-on-quarter, consumption increased by 15 percent (+16 bcm) reflecting the usual higher heating season consumption combined with colder temperatures than in the previous quarter”.

Domestic gas output was 8.6 Bcm, up 3 percent quarter-on-quarter and year-on-year. The Netherlands remained the biggest producer at 2.5 Bcm, followed by Romania at 2.4 Bcm, Germany at 1 Bcm, Italy at 0.9 Bcm and Denmark at 0.8 Bcm.

EU gas storage facilities logged an average quarterly fullness of 48 percent, compared to 88 percent in the fourth quarter of 2024 and 30 percent in the first quarter of 2024.

“EU gas storage filling rate was above the levels in 2021 and 2022 (years characterized by gas supply disruptions), but lower than the record high 2023 and 2024 filling rates, and below the 5-year historic average of 2016-2020”, the report said.

Last month the European Council and Parliament reached a provisional deal on a proposal by the European Commission to extend a regulation requiring natural gas storage facilities be at least 90 percent full before the winter season. However, the agreement scraps the November 1 deadline and gives member states flexibility by allowing them to reach the target between October 1 and December 1.

Higher Gas Prices

European wholesale prices averaged EUR 47 ($55) per megawatt hour in the first quarter of 2025, up 9 percent quarter-on-quarter and 71 percent year-on-year. The average price increased from EUR 48 per mWh in January to EUR 50 per mWh in February before falling to EUR 42 per mWh in March.

“The upward price movement (observed already in Q4-2024) continued, driven by rapidly drawn-down gas storage levels combined with lower renewable production and geopolitical tensions”, the report said.

“Asia displayed slightly lower LNG prices than Europe in January and February but became more expensive in March 2025”, it added. “On a quarterly average basis, the Asian price discount was 0.8 EUR/MWh. On a monthly basis, Asian LNG was cheaper by 1.5 EUR/MWh in January and 1.0 EUR/MWh in February. However, in March 2025 the price on the main European gas hub, the Dutch TTF became slightly lower (-0.1 EUR/MWh) than the price on the Asian JKM [Japan Korea Marker] benchmark”.

The EU average retail gas price increased 6 percent quarter-on-quarter and year-on-year to EUR 112 per mWh. Prices ranged from EUR 25 per mWh (Hungary) to EUR 184 mWh (the Netherlands).

“Retail prices continued the rise that started already in the fourth quarter of 2024”, the report said.

“Year-on-year, retail prices increased in 13 EU Member States, while prices decreased in 6 Member States, with prices in 3 Member States (Latvia, Romania, and Slovakia) remaining essentially unchanged”, it said. “The biggest year-on-year price declines were registered in Lithuania (-14 percent), Ireland (-9 percent) and Czechia (-8 percent). In some Member States retail prices displayed double-digit increases compared to the first quarter of 2024, the biggest such increase being registered in Germany (+28 percent), followed by Estonia (+27 percent) and Greece (+24 percent)”.

To contact the author, email jov.onsat@rigzone.com