The European Commission presented a legislative proposal on Tuesday to “gradually and effectively” phase out pipeline gas and liquefied natural gas (LNG) originating from, and directly or indirectly imported from, Russia in the European Union by the end of 2027.

According to the proposal, “the conclusion of new contracts for Russian natural gas would be prohibited from the beginning of 2026;”

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The proposal notes that short-term, existing contracts will only run until the summer of 2026, while long-term contracts can remain in force until the end of 2027, at the latest.

However, the proposal also includes exceptions, especially for landlocked countries, such as Hungary and Slovakia. Under the proposal, Hungary and Slovakia are given one year more time to prepare for the period after Russian natural gas. 

Although it may not amount to much, one more year buys both countries some time to find alternative sources, but may also prove problematic over the long-term.

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If the draft is adopted in this form, the Russian long-term gas supply contract (4.5 billion cubic meters) signed in 2021 will remain valid until December 31, 2027. In addition to Russian pipeline gas imports, the use of LNG terminals would also be restricted: 

From 2028, Russian companies would be prohibited from using EU LNG terminals in the long term.

It is worth noting that although crude oil was mentioned in the preliminary plans, no specific deadlines have been set yet. For now, the EU commission is asking member states to eliminate all remaining Russian oil imports by the end of 2027, as well as to tighten controls and crack down on the Russian shadow fleet.