FIRST TAKE: EU draft legislation banning Russian gas NEUTRAL for TTF, NWE, JKM *The European Commission proposes legislation banning imports of Russian gas and LNG *Draft to ban Russian gas imports from 2028; earlier ban on short-term pipeline purchases was softened *The legislative language could be amended as the process continues into summer and early autumn The publication by the European Commission of draft legislation, following on the Road Map communication of May 6, contains no major surprises. The basic thrust remains the same, with all Russian gas imports into the EU – including LNG – banned from the start of 2028, and spot or short-term sales banned earlier. The draft language should be considered NEUTRAL for prices, but did trigger a quick 3% spike (mostly given up by close) on the ICE TTF month-ahead market. The text may have seemed bullish to any market participants who were sceptical that the EC would stick to its Road Map goal of an early phaseout of spot imports of Russian LNG. If the legislation is adopted, we estimate that as much as 6 MMTPA (8.2 Bcma) of Yamal LNG – about 7 cargoes per month – will start being diverted to non-EU markets starting in January 2026 (or slightly later in case some short-term contracts are in place), and backfilled with alternative Atlantic Basin cargoes. Hungary's MVM and Slovakia's SPP will be allowed to continue imports on both existing long-term and short-term contracts through 2028, but they did not receive any exemption from the January 2028 full phaseout. They will continue to fight for some flexibility on this point – and may succeed. The legal basis for banning Russian gas imports without sanctions (which require unanimity) – and allowing importing companies to declare force majeure – is the EU-level competence on trade (specifically TFEU Article 207). This is certain to be challenged in court once final legislation is adopted later this year. Read in PlattsConnect: https://tinyurl.com/ye26pjjs