US gas abundance could ease Europe's hidden Russian fertilizer dependency
Europe cut Russian gas imports, but still relies on Moscow for fertiliser made from cheap gas feedstock.
European farmers are paying the price for a gap in the energy transition that Brussels has yet to close. The EU has slashed Russian pipeline gas imports by more than two-thirds since 2020, down from 14.7 billion cubic feet per day according to EIA data, and committed on December 3rd to end them entirely by September 20272,4. But it still imports vast quantities of Russian fertiliser — a product whose main input is cheap natural gas.
Before February 2022, Russia supplied about 30% of all fertilisers bought by European farmers4. That share has shifted but not collapsed. The EU is effectively outsourcing its gas dependence to the downstream product, buying Russian urea and ammonia made from the same feedstock it refuses to import directly.4
Fertiliser costs matter more than most energy traders realise. They constitute 15-30% of European farmers' input costs, which rose sharply between 2020 and 2025 while grain and produce prices fell, according to an Economist analysis4. The squeeze on farm margins is now translating into political pressure on Brussels to find alternatives.
The United States holds the obvious solution: abundant and cheap natural gas that can be turned into nitrogen fertiliser. NYMEX Henry Hub front-month sat at $2.89 on Tuesday (2026-07-14), against ICE Endex TTF front-month at €52.94, giving American producers a structural feedstock advantage.3
But exporting the gas alone does not solve the problem. US LNG exporters are currently asking the EU for a regulatory timeout on methane emissions rules, arguing the rules are already creating enough trade friction to slow new supply3. The alternative is shipping finished fertiliser — urea and ammonia — directly from US Gulf Coast plants, bypassing the LNG bottleneck.
Before the invasion, Europe had about 120 fertiliser factories that met roughly 70% of its need for nitrogenous fertilisers in 2020, according to the Economist4. But those factories relied on Russian natural gas or ammonia as feedstock. Many have idled or closed since 2022 as input costs surged on the spot market.
Russia's own gas production is shrinking. The country produced approximately 334.8 billion cubic meters of natural and associated gas by June, a decline of 3.2% year-on-year, according to Bloomberg-reported federal statistics data1. LNG production fell 5.1% to around 16.5 million tons. Even as exports to China via the Power of Siberia pipeline are projected to increase by over 20% this year, reaching maximum capacity of 38 bcm annually, the overall output decline constrains Moscow's ability to keep feeding European fertiliser plants.1
The trap for European buyers is timing. Azerbaijan has only about 2 bcm of additional gas supply available in the short term to replace the 14 bcm that still flowed via the Ukraine pipeline until Ukraine halted transit on Wednesday (2026-05-13) after a prewar deal expired6,5. New LNG supply from the US is years away and faces regulatory headwinds.
US nitrogen capacity takes 18-24 months to bring online. European farmers are watching the EU's tariff policy on Russian fertilisers — those tariffs are rising but may not bite hard enough to divert trade flows before the next planting season4. Capacity expansion announcements from US nitrogen producers before the European winter gas storage season closes are the concrete signal that the transatlantic fertiliser trade can shift in time to matter.4