Amidst its urgent pivot from Russian gas, the EU’s new Corporate Sustainability Due Diligence Directive (CSDDD) has drawn fierce criticism from the United States and Qatar, its top LNG suppliers. Both nations contend that the directive’s strict environmental and human rights mandates could severely undermine reliable energy deliveries and jeopardize Europe’s economic resilience, creating a critical dilemma between sustainability goals and immediate energy needs.
The European Union’s ambitious journey towards a greener future is encountering a formidable challenge from unexpected quarters: its most crucial energy partners. The United States and Qatar, key suppliers of liquefied natural gas (LNG), have issued a stern warning to Brussels, indicating that the bloc’s new Corporate Sustainability Due Diligence Directive (CSDDD) could severely disrupt energy flows, elevate costs, and imperil Europe’s hard-won energy security.
This joint message, delivered in an open letter to EU heads of state, highlights a growing tension between Europe’s environmental aspirations and its immediate need for stable, affordable energy supplies. The directive, designed to ensure companies operating within the EU uphold human rights and environmental standards across their supply chains, is ironically being flagged as an “existential threat” to the bloc’s energy and industrial future.
Europe’s Precarious Energy Landscape: A Recent History
To fully grasp the gravity of this warning, one must look back at Europe’s dramatic energy pivot. Prior to the 2022 Ukraine conflict, Russia supplied approximately 40% of the EU’s gas through its extensive pipeline network, notably via Nord Stream beneath the Baltic Sea, which was later damaged by explosions widely considered sabotage in 2022. This reliance created a significant vulnerability that the EU has since desperately sought to rectify.
The bloc’s response was a rapid shift towards LNG imports, with the United States and Qatar emerging as indispensable partners. In 2024, the US alone supplied a staggering 45% of Europe’s LNG needs, while Qatar contributed 12% to the bloc’s energy mix. This strategic realignment was a cornerstone of Europe’s efforts to achieve energy independence from Russia, a goal the EU aims to realize by 2027.
Understanding the Corporate Sustainability Due Diligence Directive (CSDDD)
At the heart of the current dispute is the CSDDD, an integral part of the EU’s broader “green agenda.” Expected to take effect in 2027, the directive mandates that larger companies operating within the EU must identify, prevent, and mitigate any adverse human rights and environmental impacts within their global supply chains. Failure to comply could result in significant financial penalties, potentially reaching up to 5% of a company’s global turnover.
The joint letter from U.S. Energy Secretary Chris Wright and Qatar’s Minister of State for Energy Affairs Saad bin Sherida Al Kaabi specifically urged reconsideration of key provisions. They highlighted concerns over Articles 2 and 22, which require companies to submit detailed plans for meeting climate goals compatible with limiting global warming to 1.5°C under the Paris Agreement. Furthermore, Articles 27 and 29, outlining financial penalties and civil liabilities for non-compliance, were cited as particularly problematic. This comprehensive set of rules aims to hold corporations accountable, yet its broad reach has sparked unexpected international friction.
Unprecedented Warnings from Indispensable Partners
The joint letter from Washington and Doha pulls no punches, describing the CSDDD as posing a “significant risk to the affordability and reliability of critical energy supplies for households and businesses across Europe.” It further labels the directive an “existential threat to the future growth, competitiveness, and resilience of the EU’s industrial economy,” according to the U.S. Department of Energy in a statement accompanying the letter energy.gov.
The warnings are not new. Earlier in 2025, Qatar explicitly threatened to suspend all LNG exports to the bloc if Brussels proceeded with its green agenda without addressing key concerns. The current directive, as written, is said to “seriously undermine the ability of the American, Qatari, and broader international energy community to maintain and expand partnerships and operations within the EU.”
Beyond energy, the directive’s implementation could also jeopardize existing and future trade agreements. A notable example is the $750 billion US energy trade deal signed in July between Brussels and US President Donald Trump, under which the bloc committed to buying substantial amounts of US energy by 2028. Such a commitment could be seriously compromised if the CSDDD leads to trade disruptions.
Broader Opposition and the EU’s Internal Debate
The concerns voiced by the US and Qatar are not isolated. The EU’s two largest economies, France and Germany, have also opposed the proposal. On the business front, prominent U.S. business groups, including the Chamber of Commerce, the American Petroleum Institute, the Business Roundtable, and the National Association of Manufacturers, have collectively expressed strong opposition. They articulated their concerns in a December 2024 letter to several U.S. Senators and Representatives uschamber.com.
The European Parliament’s legal committee had previously backed plans to water down the law in response to corporate pushback, but Qatar’s Energy Minister Saad bin Sherida Al Kaabi stated that these changes did not adequately address their key concerns. Recognizing some of the directive’s potential administrative burdens, particularly on small and medium-sized enterprises, the EU committed in August to propose changes and ease requirements. The European Parliament reported that members are considering further adjustments to reduce administrative burdens, with a vote on simplified rules scheduled for November 13 europarl.europa.eu.
The Dilemma: Green Ideals Versus Energy Realities
The controversy surrounding the CSDDD underscores a profound dilemma for the EU: how to balance ambitious climate goals with the immediate, pragmatic demands of energy security and economic stability. While the directive aims to foster greater corporate responsibility and sustainable practices, its stringent requirements threaten to alienate the very partners critical to Europe’s post-Russian energy strategy.
With the US and Qatar collectively supplying roughly 20% of the EU’s total natural gas imports—a share nearly equal to Russia’s pre-war contribution—the potential disruption to these supplies is significant. The challenge for Brussels will be to navigate these complex geopolitical and economic currents, finding a path that upholds its commitment to sustainability without compromising its fundamental energy needs or alienating key global energy partners.
