Last gas: energy costs of EU companies up to 4.5 times higher than American ones
European companies are overpaying large sums due to the refusal of the authorities of their countries from Russian energy resources. Compared to American companies, electricity costs them twice or even three times more expensive, and gas costs 4.5 times, the Russian Foreign Ministry told Izvestia. The diplomats noted that the European Union is losing competitiveness due to the cessation of imports of Russian energy resources. At the same time, Brussels wants to adopt the 19th package with restrictions against LNG, as well as stop importing it by the end of 2026. The expert community notes that such a step will lead to a sharper reduction in gas consumption in Europe than planned back in the spring.
Reducing the competitiveness of the European Union
The head of the European Commission, Ursula von der Leyen, previously proposed moving to a "new approach" to sanctions against Russia. One of the elements of pressure on it should be the tightening of energy restrictions, in particular with regard to liquefied natural gas (LNG).
Despite the actions of Brussels, the conflict in Ukraine continues, the Russian economy is growing — in 2024 it increased by more than 4%. But the European Union's rejection of Russian energy resources and, above all, natural gas has seriously affected the competitiveness of its economy, which is currently stagnating, the Russian Foreign Ministry stated.
— In 2024, the EU's GDP increased by only 1%. In 2025 and 2026, according to the forecasts of the European Commission, the picture will not change much: economic growth is expected at 1.1% and 1.5%, respectively, the ministry told Izvestia.
At the same time, the indicators of the economies of the leading EU countries, such as Germany and France, may be even lower than these values. According to forecasts of the International Monetary Fund, Germany's GDP will show zero dynamics in 2025, while France's will grow by 0.6%. According to the calculations of the European Commission, the national debt in relation to GDP will increase from 82.2% to a record 83.2% in 2025. By the way, according to the fiscal rules established in the Union, it should not exceed 60%.
"The policy of abandoning Russian energy resources has resulted in higher energy prices and, as a result, an increase in EU energy import costs," the Russian Foreign Ministry noted. — So, in 2022 they amounted to a record €604 billion, which is almost four times more than in 2020 (€163 billion).
In 2023, the amount of expenses amounted to €427 billion, and in 2024 - €376 billion, the ministry said.
The result of the abandonment of Russian resources was an increase in electricity prices. So, in 2023, for households in the EU, they exceeded pre-crisis levels by almost two times. According to the Bild newspaper, since 2022, gas and light bills for a family of four in Germany have increased by about €6 thousand (by €4,815 for gas and by €1,149 for light). Currently, the overpayment compared to tariffs until 2022 reaches 74% for gas and 14% for electricity, the newspaper points out.
— European companies have to pay two to three times more for electricity than American companies, and 4.5 times more for gas. This led to widespread closure of production facilities and their outflow to third countries. In 2024, industrial production in the EU decreased by 2.4%, the Foreign Ministry noted.
Back in 2023, more than 60 German industrial companies announced their intentions to move production abroad. In addition to the automotive industry, these were companies engaged in key industries such as mechanical engineering, industrial goods, and the chemical industry.
By the way, Germany has incurred the most serious costs due to the rejection of cheap energy resources from the Russian Federation, the diplomats emphasize. Thus, by the end of 2023, industrial production in Germany decreased by 2%, in 2024 — by 12.5%. For the chemical industry, this figure has decreased by 23% over the past two years.
— The sharp rise in the cost of raw materials and energy resources against the background of increasing pressure from Chinese competitors has created serious difficulties for the once successful automotive sector. In 2024, no more than 4 million cars were manufactured in Germany, which is 25% less than in the pre-pandemic period. In general, the industrial sector has lost about 114 thousand jobs since mid—2024," the Foreign Ministry stated.
Consequences of further abandonment of Russian resources
Capacity is declining everywhere in the European Union: more than half of aluminum production has been stopped, and the steel industry is operating at 65%. EU energy sanctions have caused serious damage to large industries in the region.
— The chemical industry has been dealt a severe blow. According to the EC itself, over the past two years, more than 20 key production sites in this industry have been closed in the EU, which has led to the reduction of about 10-20 thousand jobs, the Foreign Ministry noted.
According to diplomats, due to the abandonment of Russian energy resources, the European Union has lost 8-10% of its production capacity in the field of hydrocarbon refining by cracking over the past three years and is increasingly losing ground to competitors from the United States and the Middle East.
— The situation in the steel industry is no better, as reflected in the EU action plan on steel and metals. At the end of last year, the German giant ThyssenKrupp announced plans to cut 11,000 employees. In June last year, the Czech plant Liberty Ostrava declared bankruptcy, the Russian Foreign Ministry said.
At the same time, a draft EU regulation was published in June, laying the foundation for a complete phase-out of Russian gas by the end of 2027. The European Commission claims that the cessation of its imports allegedly will not lead to "significant" economic consequences and risks of supply disruptions. Hungary and Slovakia opposed this, calling the proposed measures economic suicide.
Despite the lack of unanimous support for this initiative, the EC has already started talking about the need to implement it in a more ambitious timeframe. According to Politico, the European Commission wants to abandon LNG from Russia by the end of 2026, that is, a year earlier than planned in the spring of this year.
— If the 19th package of sanctions includes the abandonment of Russian LNG, it means that consumption will be reduced not by a third, as originally expected, but by about 50-60%. But in both cases, we see the implementation of a strategy adopted by the European Commission that is strange from the point of view of the economic interests of European consumers, but understandable from the point of view of political prerequisites," Alexander Frolov, Deputy Director General of the National Energy Institute, explained to Izvestia.
According to the EU's plans, in 2026, gas consumption in Europe should either decrease by 10-15 billion cubic meters, or the supply on the world market should expand. However, Brussels does not have precise guarantees that Russian gas in Europe will be able to be replaced proportionally, the analyst noted.
According to the European Commission, the EU and its member states have allocated about 300 billion euros for the purpose of abandoning Russian energy resources. In the future, this amount will only grow. One of the potential gas suppliers to the union is the United States. Earlier, the EU reached an agreement with the United States on the purchase of €645 billion worth of American energy resources in the next three years, which, according to experts, is possible only at prices much higher than market prices, the Russian Foreign Ministry noted.
To accelerate the pace of abandonment of Russian energy sources, the European Commission also announced plans to introduce increased tariffs on oil imports from Russia. The purpose of such measures is to make its supplies economically less profitable, so that individual countries of the union switch to purchases from alternative sources. However, such measures are unlikely to support players such as Hungary and Slovakia. Hungarian Prime Minister Viktor Orban said that the supply of Russian oil through the Druzhba pipeline is of paramount importance for his country and there is no alternative to fuel from the Russian Federation.
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