The EU's ban on Russian LNG is approaching, Yamal's eastward exports face shipping bottlenecks

⑴ Europe currently still receives 89% of Yamal’s liquefied natural gas exports, while the European Union’s ban on Russian liquefied natural gas will cover long-term contracts starting from January 1 next year, which is about 65 days from now. ⑵ According to S&P Global, in September and October each month, 700,000 to 800,000 tons of sanctioned Russian liquefied natural gas from the Arctic LNG 2, Portovaya, and Vysotsk projects were shipped to Asian markets, reaching record levels. ⑶ The Yamal project is a more challenging issue, as the Northern Sea Route to Asia freezes between December and June of the following year, and the ban comes into effect in the middle of this window. ⑷ The S&P report states that winter shipping costs to Asia exceed $2 per million British thermal units, whereas shipping to France costs about 50 cents. ⑸ High North Logistics Center estimates that if all cargoes are shipped eastwards, the current fleet could complete 120 to 130 voyages annually, while Yamal shipped 270 cargoes in 2025, which is only half as much. ⑹ According to a producer source cited by S&P, there could be up to 10 million tons of Yamal supply losses by 2027. ⑺ Europe needs to replace about 16 million tons of supply annually, and Russia would need to double the size of its ice-class fleet. ⑻ In the winter of 2027, both sides’ bills will come due simultaneously.