Executives from ExxonMobil and QatarEnergy have warned they may halt or sharply reduce their business activities in Europe if the European Union presses ahead with a far-reaching sustainability law that would impose heavy obligations and steep fines on multinationals operating within its borders.
The warning, delivered at the ADIPEC energy conference in Abu Dhabi, underscores growing tension between Brussels and major global suppliers over the bloc’s expanding climate and corporate governance agenda — one that has already rattled U.S. tech giants and is now reverberating through the energy sector.
ExxonMobil’s Chief Executive Darren Woods told Reuters that the EU’s proposed Corporate Sustainability Due Diligence Directive (CSDDD) could have “disastrous consequences” if passed in its current form. The legislation requires companies doing business in the EU to identify and mitigate human rights and environmental risks across their global supply chains. It allows fines of up to 5% of global turnover for violations.
“If we can’t be a successful company in Europe, and more importantly, if they start to try to take their harmful legislation and enforce that all around the world where we do business, it becomes impossible to stay there,” Woods said.
He argued that the directive overreaches by demanding that companies like ExxonMobil not only ensure compliance for European operations but also extend the same standards globally — even in countries where EU law does not apply.
QatarEnergy’s CEO and Energy Minister Saad al-Kaabi delivered a similar warning, saying the company could reconsider gas shipments to Europe if the directive is not significantly softened.
“We can’t reach net zero, and that’s one of the requirements, among other hosts of things,” Kaabi said. “Europe needs to understand that they need gas from Qatar. They need gas from the U.S. They need the gas from many places around the world … it’s very important that they look at this very seriously.”
He said QatarEnergy already has contingency plans in place if it decides to suspend or scale down supplies.
Both executives spoke at a time when the EU’s green policies have come under scrutiny for their economic impact. The CSDDD, introduced as part of Europe’s broader push to achieve climate neutrality by 2050, aims to make companies legally responsible for human rights and environmental damage in their supply chains, even if such harms occur outside the continent.
It is part of a sweeping regulatory tightening by Brussels that has also targeted Silicon Valley firms through measures such as the Digital Markets Act (DMA) and the Digital Services Act (DSA). These laws have compelled U.S. tech giants — including Google, Apple, Meta, Amazon, and Microsoft — to make major operational changes, prompting accusations of regulatory overreach from Washington and industry leaders.
For energy companies like ExxonMobil and QatarEnergy, the implications are no less serious. The CSDDD would compel firms to publish detailed transition plans aligned with the Paris Agreement’s target of limiting global temperature rise to 1.5°C — something Woods described as “technically unfeasible.”
“What’s astounding to me is the overreach,” he said, stressing that the directive effectively forces the same environmental standards on all operations worldwide.
Both ExxonMobil and QatarEnergy are among Europe’s top suppliers of liquefied natural gas (LNG). Since Russia’s invasion of Ukraine in 2022, Europe has leaned heavily on American and Qatari gas to replace Russian pipeline flows, making any disruption or withdrawal a direct threat to the bloc’s energy security. The U.S. alone now accounts for roughly half of Europe’s LNG imports, while Qatar supplies between 12% and 14%.
The relationship is commercially deep. ExxonMobil said last year it had invested €20 billion ($23.3 billion) in Europe over the past decade, and QatarEnergy maintains long-term LNG supply contracts with Britain’s Shell, France’s TotalEnergies, and Italy’s ENI. Both firms dramatically increased shipments after Russia’s energy cutoff.
Governments in Qatar and the U.S. have since urged European leaders to reconsider the law, warning that strict enforcement could undermine Europe’s energy supply and investment environment. Washington’s own trade officials have echoed concerns that the bloc’s ESG (Environmental, Social, and Governance) measures, if left unchecked, could set a precedent for extraterritorial enforcement that complicates global business operations.
The European Parliament has acknowledged the backlash and agreed to reopen negotiations on the directive, with the goal of finalizing revisions before year-end. The current version remains contentious, with environmental groups insisting that corporate accountability must not be weakened, while industry advocates argue that without adjustments, the law risks pushing away essential suppliers and raising costs for European consumers.
Energy analysts say the clash captures a defining dilemma of the EU’s climate strategy that involves balancing moral and environmental commitments with the practical need for affordable energy and investment. As European policymakers pursue ambitious ESG targets, corporations — from Big Tech to Big Oil — are warning that the regulatory load is reaching a breaking point.
