EU nations split on capping Russian gas prices amid high energy costs

Amid working out measures to protect citizens and businesses from soaring energy bills, energy ministers of the European Union (EU) were reportedly divided on capping the prices of Russian gas during their meeting earlier on Friday.

Apparently, the ministers had indicated taking broad measures to prevent power suppliers from being crushed due to a liquidity crunch before the meeting, with many stating that it was urgent to delink the gas prices from other cheaper sources of energy.

The meeting was held to come up with options for further discussions rather than reaching a conclusive decision on tackling the crisis caused by the invasion of Ukraine by Russia.

Jozef Sikela, Czech Industry Minister, said that the EU is in an energy war with Russia and needs to send a clear signal that the authorities are doing their best to support their economies and households.

For the record, energy bills have been surging amid high demand for gas, following recovery from the pandemic, with further rise due to the war in Ukraine.

With Russia reducing its gas deliveries to Europe following the Western sanctions impositions, EU nations are struggling to mitigate the energy price shock. Thus, an EU proposal for capping Russian gas prices has not been able to draw support from a majority of nations, while Russia threatens a total cut-off of the declining supply if such a measure is taken.

Reportedly, Baltic states are supporting the idea as it would deprive Moscow of the cash needed for funding military action in Ukraine. However, central and eastern states, much of whom rely on Russian fuel, fear losing their supplies, while some doubt the capping will have a significant impact on lowering prices given the low deliveries.

Earlier this week, the European Commission said it would propose a measure to retrieve revenues from non-gas power generators and deploy the cash in reducing consumer bills.

On the other side, France has questioned its application to all non-gas generators, such as nuclear power.

Source credit: https://www.reuters.com/business/energy/eu-countries-seek-emergency-solution-soaring-energy-bills-2022-09-09/