Qatar threatened EU countries to cut off gas supplies due to new fines

Qatar's national oil and gas company Qatar Energy has threatened to stop supplying liquefied natural gas (LNG) to European Union (EU) countries if they heavily penalize companies there in the amount of 5% of annual revenue for failure to comply with criteria on carbon dioxide emissions and human rights. Qatar's energy minister and Qatar Energy CEO Saad bin Sharida Al Kaabi told the Financial Times (FT) on December 22.

"If it comes to the point where I will lose 5% of revenue by going to Europe, I will not go to Europe. <...>. I am not bluffing," he noted.

The head of the agency explained that such a large penalty on his company's revenue means 5% of the revenue of the entire state of Qatar.

"This is people's money <...>, so I cannot lose that much money, and no one will accept the loss of such money," al-Kaabi added.

In May, EU countries decided to impose fines for failing to meet criteria related to carbon emissions, human rights and labor rights. The size of the penalty is at least 5% of companies' annual revenue. These measures are part of the EU policy to achieve zero emissions by 2050 and will come into force in 2027.

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Prior to that, Turkish President Recep Tayyip Erdogan and Qatar's Emir Sheikh Tamim bin Hamad Al Thani agreed to strengthen energy cooperation and bilateral LNG trade between their countries during the 10th meeting of the Turkish-Qatari Supreme Strategic Committee on Nov. 15.

Earlier, on Nov. 7, the Financial Times warned that EU countries could face disruptions in gas supplies in winter. Analysts linked one of the risks to the limited supply of LNG on global markets, which could lead to Europe having to compete with Asia for this type of fuel and lead to an increase in its prices.