IOGP Europe recommendations to help the EU restore its security of supply and competitiveness through flexible and resilient energy markets.

We welcome the European Commission’s (EC’s) initiative to review the EU’s energy security framework. Recent developments have demonstrated both the vulnerabilities and strengths of Europe’s energy system: the abrupt loss of major pipeline supplies and episodes of power grid instability highlighted its exposure, while the rapid response of markets, infrastructure operators, and global LNG trade showcased its capacity to adapt. These experiences confirm that well-functioning, flexible markets remain the best guarantee of resilience, even under extreme conditions.

The resilience of the EU energy system depends on coherent interaction between all relevant legislations. Therefore, the revision of the energy security framework should go beyond the current Gas Security of Supply Regulation, addressing cross-sectoral linkages and avoiding fragmented or overlapping rules. Future measures should build on identified strengths while remaining pragmatic, flexible and forward-looking. A complex regulatory framework may lead to limited sourcing flexibility and price spikes – with direct implication for EU’s competitiveness.

Natural gas plays a critical role in supporting the integration of intermittent renewable energy sources, providing flexible and reliable back-up capacity that underpins system stability. By emphasizing the importance and long-term need for natural gas, maximizing domestic production, promoting infrastructure development, ensuring a stable, clear and enabling regulatory framework, and avoiding potential barriers to importers pursuing diversification and security of supply, EU can achieve greater security of supply while meeting its climate objectives. Allowing full access to all supply sources (without artificial premiums or restrictions) maximizes diversification, supply options and competition to achieve the lowest price.

Despite projected global rise in natural gas production and export capacity, indirect policy signals and regulatory challenges discourage long-term energy contracting. Key obstacles include low EU energy demand projections based on challenging Net-Zero targets without potential upside scenarios for gas and power demand (e.g., driven by AI), market interventions, mixed political signals on the role of natural gas in the EU’s future energy mix, heavy administrative burden, prescriptive requirements, and regulatory risks for suppliers. It is important that measures introduced by the EC do not unintentionally undermine the market’s ability to respond to possible crisis by introducing rigid or counterproductive requirements, particularly when it comes to reporting.

In fact, some recent regulatory provisions are already weakening Europe’s sourcing flexibility, for instance the EU Methane Regulation (EUMR) which, through uncertainty about compliance pathways, is currently constraining future supply options. Hence, it seems important that the impact of all major regulatory modifications is properly assessed first and options to mitigate negative effects are reviewed with stakeholders before implementation.
The primary objective of the review of the EU Gas Security of Supply Regulation should be to adapt existing tools to make them more operational, reducing complexity, and preserving the advantages of liquid markets. Cross-sectoral regulatory consistency should be ensured between gas and electricity as much as possible. We provide recommendations on the six building blocks identified by the EC, attached in Annex. Taken together, these recommendations suggest that the revision of the energy security framework should not increase requirements but rather streamline or reinforce existing tools in a pragmatic, targeted manner.

A future-proof framework must be pragmatic, economical, operational, and able to support the transition while safeguarding the availability of reliable and affordable energy.