On Tuesday, European Union energy ministers are set to discuss a bloc-wide gas price cap, attempting to navigate their next steps, though any final decisions are likely to take weeks.
Europe has been scrambling to contain high energy prices since Russia cut gas supplies in the aftermath of its invasion of Ukraine, sending gas prices skyrocketing and pushing European power prices to record levels in August.
With no legal proposal for a price cap on the table, ministers meeting in Luxembourg are expected to discuss the principles of how an EU gas price cap might work, as well as potential drawbacks.
However, gas prices have fallen in recent days due to mild weather and countries filling storage tanks.
Some EU diplomats suggested that this could dampen momentum for a cap on energy costs, but others said a cap was still needed to protect against price spikes as Europe enters winter.
Last week, the European Commission requested countries' approval to draft a proposal for a price limit on trades at the Title Transfer Facility (TTF) Dutch gas hub, which could be triggered if prices rose.
A few days later, EU leaders requested "concrete decisions" on this idea from their ministers and Brussels.
According to EU diplomats, Tuesday's talks could give the Commission approval for that proposal, but some countries want more details on how a price cap would work.
"I'm missing a lot of things within the proposal... the Commission should deliver the remaining parts of the puzzle," said Czech industry minister Jozef Sikela, who chairs Tuesday's meeting.
"I am slightly disappointed that we are not going as fast forward as possible," he added.
The EU Commission shared a document with countries ahead of Tuesday's talks that warned against another type of price cap, for gas used to generate electricity, which it said could cause an increase in gas use.
According to one senior EU official, it is unclear when Brussels will make a firm proposal on a price cap. Any proposal would have to be negotiated by EU member states, with the goal of approving it at an emergency meeting of energy ministers in November.
On Monday, the benchmark Dutch front-month gas contract traded at 93.35 euros/MWh, its lowest level since June, but still far higher than prices in 2021.
(Source:www.reuters.com)
Europe has been scrambling to contain high energy prices since Russia cut gas supplies in the aftermath of its invasion of Ukraine, sending gas prices skyrocketing and pushing European power prices to record levels in August.
With no legal proposal for a price cap on the table, ministers meeting in Luxembourg are expected to discuss the principles of how an EU gas price cap might work, as well as potential drawbacks.
However, gas prices have fallen in recent days due to mild weather and countries filling storage tanks.
Some EU diplomats suggested that this could dampen momentum for a cap on energy costs, but others said a cap was still needed to protect against price spikes as Europe enters winter.
Last week, the European Commission requested countries' approval to draft a proposal for a price limit on trades at the Title Transfer Facility (TTF) Dutch gas hub, which could be triggered if prices rose.
A few days later, EU leaders requested "concrete decisions" on this idea from their ministers and Brussels.
According to EU diplomats, Tuesday's talks could give the Commission approval for that proposal, but some countries want more details on how a price cap would work.
"I'm missing a lot of things within the proposal... the Commission should deliver the remaining parts of the puzzle," said Czech industry minister Jozef Sikela, who chairs Tuesday's meeting.
"I am slightly disappointed that we are not going as fast forward as possible," he added.
The EU Commission shared a document with countries ahead of Tuesday's talks that warned against another type of price cap, for gas used to generate electricity, which it said could cause an increase in gas use.
According to one senior EU official, it is unclear when Brussels will make a firm proposal on a price cap. Any proposal would have to be negotiated by EU member states, with the goal of approving it at an emergency meeting of energy ministers in November.
On Monday, the benchmark Dutch front-month gas contract traded at 93.35 euros/MWh, its lowest level since June, but still far higher than prices in 2021.
(Source:www.reuters.com)
