EU nations work on rift over gas price cap as cold sets in

  • In US
  • 2022-11-24 12:07:33Z
  • By Associated Press

BRUSSELS (AP) - On winter's doorstep, European Union nations have not been able to surmount bitter disagreements as they struggle to effectively shield 450 million citizens from massive increases in their natural gas bills as cold weather sets in.

An emergency meeting of energy ministers Thursday only shows how the energy crisis tied to Russia's war in Ukraine has divided the 27-nation bloc in almost irreconcilable blocs.

A massive August spike in natural gas prices stunned all but the wealthiest in the EU, forcing the bloc to look for a cap to contain volatile prices that are fueling inflation. Following several delays, energy ministers are back trying to break a deadlock between nations that are demanding cheaper gas to ease household bills - including Greece, Spain, Belgium, France and Poland - and those like Germany and the Netherlands that are insisting a price cap could cut supplies.

A solution was nowhere near the horizon - to the frustration of many.

"It's already minus 10 (Celsius) in Poland," said the nation's energy minister, Anna Moskwa. "It's winter now."

Natural gas and electricity prices have soared as Moscow has slashed gas supplies to Europe used for heating, electricity and industrial processes. European officials have accused Russia of energy warfare to punish EU countries for supporting Ukraine.

So finding a deal is not only about providing warmth to citizens but also about showing a united front to Russian President Vladimir Putin.

Talks have dragged on for months and even if a summit of EU leaders proclaimed some sort of breakthrough last month, nothing has been visible on the ground. Nations had been waiting for a proposal from the European Commission, the EU's executive arm, to set a threshold for a price cap, and when it came Tuesday, there was dismay and accusations it could never work.

The commission set a threshold for a "safety price ceiling" to kick in if prices exceed 275 euros per megawatt hour for two weeks and if they are 58 euros higher than the price for liquefied natural gas on world markets.

In political language, it means that such a system might not even have averted hikes as high as in August.

"Setting a ceiling at 275 euros is not actually a ceiling," said Greek Energy Minister Konstantinos Skrekas, who called for a cap that could go as low as 150 euros.

"We are losing valuable time without results," he added.

In comparison, the price stood at 125 euros per megawatt-hour on Europe's TTF benchmark Thursday. Since the price has fallen since the summertime peaks, diplomats have said the urgency has abated somewhat, even though it could pick up quickly again if the weather is colder than normal and supplies get tight.

Some 15 nations are united around these views, but Germany and the Netherlands lead another group wanting to ensure that gas supply ships would not bypass Europe because they could get better prices elsewhere.

"Security of supply is paramount. Europe still has to be an attractive gas market," Estonian Economy Minister Riina Sikkut said.

No decisive breakthrough was expected at Thursday's meeting.

Czech Industry Minister Jozef Síkela, who chaired the emergency meeting, said he was well aware of the "emotional reactions" the commission proposal had sparked and predicted that talks would be "rather spicy."

As a result of trade disruptions tied to Russia's war in Ukraine, EU nations have reduced the overall share of Russian natural gas imports to the EU from 40% before the invasion to around 7%. And gas storage has already far exceeded targets and stand nearly at capacity.

The EU has relied on increased imports of liquefied natural gas, or LNG, including from the United States, to help address the fall in Russian supplies.


More Related News

Germany on cusp of recession despite Olaf Scholz saying country will avoid one
Germany on cusp of recession despite Olaf Scholz saying country will avoid one

Germany has fallen into recession, experts have warned, after official data revealed a surprise slump at the end of last year.

European Gas Prices Swing as Traders Track Demand, Stockpiles
European Gas Prices Swing as Traders Track Demand, Stockpiles

(Bloomberg) -- European natural gas fluctuated as the return of warmer weather keeps a lid on heating demand, even as cheaper fuel brings the possibility of ...

China Dismisses US Claims of Support for Russia as
China Dismisses US Claims of Support for Russia as 'Paranoia'
  • World
  • 2023-01-30 08:37:40Z

(Bloomberg) -- China hit back at a report that the US has confronted it with evidence suggesting some of its state-owned firms may be helping Russia's war in...

Ukraine Latest: Russian Missile Hit on Kharkiv Building Reported
Ukraine Latest: Russian Missile Hit on Kharkiv Building Reported
  • World
  • 2023-01-30 00:23:12Z

(Bloomberg) -- A suspected Russian surface-to-air missile slammed into a residential building in Kharkiv, causing a fire and casualties, the city's mayor...

Russia's War in Ukraine is Accelerating the Shift Away From Oil and Gas, BP Says

(Bloomberg) -- Russia's war in Ukraine will accelerate the shift away from oil and gas as countries around the world prioritize domestic renewable energy...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply


Top News: US