BRUSSELS, July 20 — The European Commission instructed European Union governments to waive penalties for three years for oil and gas companies that breach its methane emissions law, following pressure from the United States to roll back the rules.
The US, Qatar, oil and gas industry groups, and most EU members have demanded changes to the law in recent months, warning it could hamper Europe’s ability to secure fuel supplies, when from January 2027, it is due to require imported gas to meet emissions monitoring rules equivalent to Europe’s.
The commission today said EU countries should not apply penalties to companies that breach the methane law in 2027, 2028 and 2029, in order “to avoid supply disruptions”.
The law had been designed so companies failing to comply could face fines up to 20 per cent of their annual turnover.
The commission said the changes are justified “in a context of global energy markets tightness caused by the ongoing blockade of the Strait of Hormuz”, which has disrupted the transit route for a fifth of the world’s oil and liquefied natural gas supply.
The change would weaken the world-first EU climate policy, which was designed to clamp down on leaks of methane, a potent greenhouse gas and the second-biggest cause of climate change after CO2 emissions.
However, it does not go as far as critics of the law would want — since it does not amend the law, but just temporarily waives penalties for breaching it. A group of 17 of the EU’s 27 members, including Germany and the Czech Republic, have asked the EU to delay the law.
Analysts have given conflicting assessments of whether the rules would restrict the amount of oil and gas the EU can secure on global markets.
The commission’s “recommendation” on waiving penalties instructs countries to apply EU law in a certain way, but is not binding.
However, a commission official today said national courts are obliged to take into account the recommendation — which would help companies fend off any claims they should face penalties for breaching the law.
