Protecting Europe’s Energy Security Act of 2019

This bill, placed on the Senate Legislative Calendar, directly imposes sanctions on entities involved in the construction of the Nord Stream 2 pipeline. This action aims to prevent Russia from completing the pipeline, thereby increasing Europe's reliance on alternative energy sources, specifically U.S. natural gas. The immediate impact is a reduction in future Russian energy dominance in Europe, opening a significant market for U.S. energy companies. The money trail flows directly to U.S. natural gas producers and LNG export terminal operators. With Nord Stream 2 stalled or abandoned, European nations will seek alternative gas supplies. This translates into increased demand for U.S. LNG, benefiting companies like EQT Corporation ($EQT) and CNX Resources ($CNX) through higher natural gas prices and increased production. Furthermore, operators of LNG export terminals, such as Cheniere Energy ($LNG) and Kinder Morgan ($KMI), will see increased utilization and potential expansion opportunities. Major integrated oil and gas companies like Exxon Mobil ($XOM) and Chevron ($CVX) also stand to gain from increased U.S. natural gas production and export capacity. Historically, similar geopolitical actions impacting energy supply chains have led to significant market shifts. For example, when Russia cut gas supplies to Ukraine in 2009, European nations immediately sought diversification. While not directly comparable to a U.S. sanctions bill, the market response to supply disruptions consistently favors alternative suppliers. More recently, following Russia's invasion of Ukraine in February 2022, which led to significant reductions in Russian gas flows to Europe, U.S. LNG exports surged. Companies like Cheniere Energy ($LNG) saw their stock price increase by over 30% in the first six months of 2022, and U.S. natural gas futures (Henry Hub) rose significantly, benefiting producers. This bill, though predating the 2022 invasion, established the framework for such a shift. Specific winners include U.S. natural gas producers EQT Corporation ($EQT) and CNX Resources ($CNX), and LNG export terminal operators Cheniere Energy ($LNG) and Kinder Morgan ($KMI). Integrated energy giants Exxon Mobil ($XOM) and Chevron ($CVX) also benefit from increased U.S. energy export demand. Companies involved in the Nord Stream 2 project, primarily European and Russian entities, are the direct losers, facing sanctions and project delays or cancellations. The bill's placement on the calendar indicates it is moving through the legislative process, and its eventual passage would solidify these market shifts. What happens next is the bill's potential passage through the Senate and House, and enactment into law. Given its placement on the calendar, it is positioned for a vote. Once enacted, the sanctions will be implemented, directly impacting the Nord Stream 2 project and cementing the competitive advantage for U.S. energy exporters.