The United States and Britain announced on Wednesday an energy partnership aimed at sustaining a higher level of liquefied natural gas (LNG) exports to Britain and collaborating on ways to increase energy efficiency.
Britain and other European countries have turned to the United States as they try to reduce their reliance on Russian energy supplies following Moscow’s invasion of Ukraine begun in February.
“This partnership will bring down prices for British consumers and help end Europe’s dependence on Russian energy,” British Prime Minister Rishi Sunak said in a statement.
The “UK-US Energy Security and Affordability Partnership” will also aim to drive investment in clean energy and exchange ideas on energy efficiency and reducing demand for gas.
Household energy bills have hit record highs this year following Russia’s invasion of Ukraine forcing the UK government to cap costs and subsidise the difference, a measure analysts forecast could cost up to 42 billion pounds ($51 billion) over the 18 months the cap is in place.
Western countries are also attempting to cap how much Russia can profit from the rise in energy costs that has followed its invasion of Ukraine.
The G7 – which includes Britain and the United States – has agreed a $60 per barrel price cap on Russian seaborne crude oil.
The United States became the world’s largest LNG exporter in the first half of 2022, U.S. Energy Information Administration data showed as the country rapidly increased its export capacity and high prices, particularly in Europe led to higher exports.
Britain said the United States would aim to export 9-10 billion cubic metres of LNG over the next year under the agreement, maintaining the increase in exports seen this year.
Refinitiv Eikon data showed Britain has imported around 11 billion cubic metres (bcm) of gas from the United States so far in the first 11 months of 2022, up from 4 bcm in 2021.
Sunak met U.S. President Joe Biden at the G20 in Indonesia last month, where Sunak highlighted the importance of the United States as an economic partner even without a free trade deal. Talks on a free trade agreement are suspended.
On Wednesday, Junior Trade Minister Greg Hands will begin a visit to the United States, where he is announcing a memorandum of understanding on trade with South Carolina, the third such agreement with a U.S. state aimed at boosting trade missions and sharing expertise.
