Economy

Can ExxonMobil’s EU Exit Threat Force a Rethink of the Corporate Sustainability Directive?

ExxonMobil warns EU ops halt if climate directive isn’t changed; Qatar threatens LNG supply cut.

November 3, 2025, 10:33 AM

Exterior view of a bright red and white ESSO gas station in Mainz, Germany, with a tall price sign and cars fueling.

An ESSO gas station in Mainz, Germany, a trading name for ExxonMobil and related companies. By Vytautas Kielaitis / Shutterstock.com.

Executive Summary

ExxonMobil has warned it may cease operations in the EU if the Corporate Sustainability Due Diligence Directive (CSDDD) is not significantly amended, deeming its global climate plan requirements “technically unfeasible” and an “overreach.”

Qatar has reissued threats to halt liquefied natural gas (LNG) supplies to Europe over the CSDDD, stating it cannot meet the directive’s net-zero requirements and emphasizing Europe’s reliance on its gas.

Both ExxonMobil and Qatar argue the CSDDD jeopardizes Europe’s access to reliable and affordable energy, with the EU aiming to approve final amendments to the law by the end of the year.

The Story So Far

The European Union’s proposed Corporate Sustainability Due Diligence Directive (CSDDD) is the central issue, as it mandates companies to implement climate transition plans aligned with the Paris Agreement across their entire global operations, not just within the EU, and carries significant potential fines. Major energy suppliers like ExxonMobil and Qatar deem this global scope “technically unfeasible” and an “overreach,” leading to their threats to cease EU operations or halt critical liquefied natural gas (LNG) supplies. These actions stem from concerns that the directive jeopardizes Europe’s access to reliable energy, particularly given Europe’s increased reliance on Qatari LNG since Russia’s 2022 invasion of Ukraine.

Why This Matters

The European Union’s proposed Corporate Sustainability Due Diligence Directive (CSDDD) is facing significant challenges, with ExxonMobil threatening to cease operations and Qatar reiterating threats to halt crucial LNG supplies, potentially jeopardizing Europe’s energy security and economic stability. These warnings highlight concerns over the directive’s perceived global regulatory overreach and its potential to exacerbate Europe’s “de-industrialization” by making the region an unviable place for major energy companies to operate.

Who Thinks What?

ExxonMobil believes the Corporate Sustainability Due Diligence Directive (CSDDD) is “technically unfeasible” and an “overreach” due to its global scope, warning it would suffocate economic growth in the EU and could force the company to cease operations there.

Qatar, through its energy minister Saad al-Kaabi, contends that the CSDDD’s net-zero requirements cannot be met and has threatened to halt LNG supplies to Europe if the law is not changed, arguing it jeopardizes Europe’s access to reliable and affordable energy.

European lawmakers, in proposing the CSDDD, aim to hold companies accountable for human rights and environmental risks throughout their supply chains, though they are currently negotiating further amendments to the law.

U.S. energy giant ExxonMobil has warned it may be forced to cease operations in the European Union if the bloc does not significantly amend its Corporate Sustainability Due Diligence Directive (CSDDD). CEO Darren Woods stated on Monday that the law, which demands climate transition plans aligned with the Paris Agreement across global operations and carries potential fines of 5% of global revenue, is “technically unfeasible.” This stance is echoed by Qatar, a major gas producer, which has reissued threats to halt liquefied natural gas (LNG) supplies to Europe over the same legislation.

ExxonMobil’s Concerns Over Regulatory Scope

Speaking in Abu Dhabi, Mr. Woods outlined his concerns that the directive’s requirements extend beyond European operations, mandating climate plans for all of ExxonMobil’s global business irrespective of its connection to Europe. He described this as an “overreach” that would make it “impossible” for the company to continue operating successfully within the EU. The CSDDD aims to hold companies accountable for human rights and environmental risks throughout their supply chains.

ExxonMobil is actively lobbying against the directive, with Mr. Woods warning of “disastrous consequences” if it is adopted in its current form. While European lawmakers have engaged with energy producers, he noted that this has not led to substantial changes, but rather “muddling the language” which he believes increases room for interpretation and exposure.

Mr. Woods also criticized the broader economic environment, stating that the EU is already an “overregulated economy” that is “de-industrialising” and “suffocating economic growth.” He argued that the new directive would further impede economic development.

Qatar Echoes Objections on Energy Supply

Qatar’s energy minister, Saad al-Kaabi, who is also CEO of QatarEnergy, reinforced similar objections, stating that his country cannot meet the directive’s net-zero requirements. He reiterated a threat to halt LNG supplies to Europe if the law is not changed or cancelled. Qatar currently supplies between 12% and 14% of Europe’s LNG imports since Russia’s 2022 invasion of Ukraine.

Both Qatar and the United States previously urged European heads of state last month to reconsider the law, arguing it jeopardizes Europe’s access to reliable and affordable energy. Mr. al-Kaabi emphasized Europe’s reliance on gas from various global sources, including Qatar and the U.S., urging serious consideration of the directive’s impact.

Upcoming EU Decision

The European Parliament agreed last month to further negotiate changes to the law, with the EU aiming to approve final amendments by the end of the year. Energy companies, including ExxonMobil, have called for the complete withdrawal of the policy, arguing it would lead to businesses relocating away from Europe.