Oil and Gas Industry Calls on EU to Pause Methane Emissions Law

SNN – Oil and gas companies have urged the European Union to pause its upcoming methane emissions regulation, warning that stricter rules could disrupt Europe’s fuel imports when new provisions take effect in 2027.

The request from the industry follows pressure from the United States government, which has asked the EU to exempt U.S. oil and gas exports from the policy. While Brussels has offered companies more flexible compliance options, it has so far refused to roll back the law, which is considered a key part of the bloc’s climate strategy.

A study supported by the industry and conducted by Wood Mackenzie found that as much as 43% of the EU’s gas imports and 87% of its crude oil imports may struggle to meet the new requirements by 2027. The report warned that companies could face heavy fines and that some suppliers might reduce shipments to Europe, potentially creating supply shortages.

Industry groups including IOGP and FuelsEurope have called on the EU to pause and revise the legislation. Francois-Regis Mouton de Lostalot, managing director of IOGP Europe, said the EU risks creating a regulatory supply shock, especially given the current geopolitical situation.

Energy markets have already been under pressure this month as oil and gas prices surged following the ongoing conflict involving the United States, Israel, and Iran. Europe is also still adjusting to its gradual phase-out of Russian energy imports, with most of its current oil and gas supplies coming from Norway and the United States.

Under the EU methane law, gas imported into the bloc from January 2027 must comply with monitoring and verification standards equivalent to those used within Europe, or meet an industry benchmark known as Oil and Gas Methane Partnership (OGMP) 2.0 level 5.

However, environmental groups have challenged the industry’s concerns. The Environmental Defense Fund said its analysis shows that global supplies of gas meeting the OGMP 2.0 level 5 standard by 2027 could be more than double the EU’s demand, including production from Norway and the United States.

A spokesperson for the European Commission did not immediately comment on the industry’s request.