EU's Borrell Blames Gas Crunch on Russia 'Crisis', Renews Calls for Diversification

"Energy has always been among the most important geopolitical issues. With high prices and gas supplies challenges caused by the crisis with Russia, it is at the top of our agenda," his blog post read.

Energy dependence on Russia has always loomed large over the EU, Borrell said, with the bloc relying on its eastern neighbour for more than 40% of natural gas imports.

He said that the 27-nation union had been complacent about weaning itself off Russian supplies, in comparison to Russia, which has taken steps to shield itself from Western sanctions.

"In recent years, Russia has enhanced its resilience against economic sanctions, by increasing its foreign currency reserves, more than we have done to enhance our capacity to face potential gas supply cuts", he said.

FILE PHOTO: Josep Borrell, vice president of the European Commission in charge of coordinating the external action of the European Union, delivers a speech at the European Parliament, in Strasbourg, France, June 8, 2021

It is now time that the EU look elsewhere to source gas and create strategic gas reserves, the top EU diplomat said. Beyond the US, he pointed to Norway, Qatar, Azerbaijan and Algeria as possible liquefied natural gas suppliers.

"These efforts are more likely to succeed if we invest in relations with potential LNG suppliers, not as a short-term fix, but as part of our interest in developing more strategic relationships," he added.

Turning to Ukraine, Borrell said that the EU wanted to increase reverse flows to the country within the existing gas transportation network, ahead of Ukraine's planned synchronization to the European electricity grid in 2023.

"True energy security can however only come through more investment in domestic renewables and better connections with the EU market", he added.

Borrell stressed that the EU should continue working on cutting its dependence on fossil fuels and investing in hydrogen and solar to safeguard itself from future price shocks.

Gas prices in the EU are already 6-10 times higher than a year ago, Borrell estimated. This is driving electricity prices and inflation upward. He predicted that if energy prices stayed high throughout 2022 this would seriously affect the post-pandemic recovery.