Energy crisis: EU leaders divided on gas price cap



European Union leaders struggled to seek out fast sensible options at their summit Thursday referred to as to grapple with the vitality disaster fuelled by the conflict in Ukraine and preserve a united entrance within the face of Russian President Vladimir Putin coercion.

After prolonged talks in Brussels dragged nicely into the evening, the 27 EU leaders couldn’t bridge divisions between a number of the largest member states and didn’t impose a gas price cap to counter Russia’s technique to choke off gas provides to the bloc at will.

They agreed, nonetheless, to maintain working to discover a compromise primarily based on proposals unveiled earlier this week by the European Commission, the EU’s government arm, which have been mentioned in depth and tweaked on the summit.

“Unity and solidarity prevail,” mentioned assembly host Charles Michel, the EU Council president. “Agreed to work on measures to include vitality costs for households and companies.”

Diplomats mentioned the influence of the proposals must be correctly assessed by specialists earlier than approval, and leaders insisted any deal would want to consider their completely different vitality mixes.

“You don’t hop on a train without knowing the destination,” a senior diplomat summed it up. He was not approved to talk publicly on the discussions, in accordance with EU apply.

To ensure the runaway price of gas doesn’t additional tank struggling EU economies, the Commission has proposed a system to pool shopping for of gas and supplied a compromise that will enable for a correction mechanism to kick in in distinctive circumstances.

In addition, it’s pushing for the creation of a brand new LNG gas index higher reflecting the market following the drastic discount of imports of pipeline gas from Russia.

Divisions have been so large at the beginning of the summit that agreeing on additional exploration of the plan proposed by the Commission was seen as virtually an achievement in itself.

Hungarian Prime Minister Viktor Orban mentioned a price cap would ship suppliers away. The “gas price cap is like going to a bar and telling the bartender you want to pay half price for your beer. Not going to happen,” he mentioned on Twitter.

The conventional driving duo of the EU — Germany and France — weres in opposing camps, with Germany expressing doubts and holding off plans for the price cap, whereas most others need to push on.

“Our role is to make sure that there is a European unity and that Germany is part of it,” mentioned French President Emmanuel Macron. “It is not good either for Germany or Europe that it isolates itself. It is important that on proposals that are the subject of a broad consensus, we can find unanimity.”

German Chancellor Olaf Scholz mentioned any dispute was on the tactic, not the purpose. “Prices for gas, for oil, for coal, must sink; electricity prices must sink, and this is something that calls for a joint effort by all of us in Europe,” he mentioned.

The Netherlands feared that if a price cap was set too excessive, provides would merely sail by Europe and go elsewhere. “Everyone wants the gas price to come down, but you want to make sure that gas imports keep coming,” Prime Minister Mark Rutte mentioned.

Natural gas costs spiraled uncontrolled over the summer time as EU nations sought to outbid each other to replenish their reserves for winter. The member states have already agreed to chop demand for gas by 15 per cent over the winter. They have additionally dedicated to filling gas-storage amenities to a minimum of 80 per cent of capability by November and — as a method of lowering gas-fired energy era — to lowering peak demand for electrical energy by a minimum of 5 per cent.

The query of attainable EU gas-price caps has moved steadily up the political agenda for months because the vitality squeeze tightened, with 15 international locations equivalent to France and Italy pushing for such blunt intervention, with out agreeing on the tactic.

And the place Angela Merkel was the soothing voice typically brokering a compromise throughout her 16 years as German chancellor, her successor Scholz is now on the coronary heart of a division within the bloc.

Germany and the Netherlands preserve that market interventions like extreme price caps may damage each the supply of pure gas and incentives for governments and shoppers to reserve it.

At the opening of the summit, the necessity for rock-solid EU unity in confronting Russia was highlighted by Ukrainian President Volodymyr Zelenskyy, who addressed the 27 nationwide leaders by video convention from Kyiv, asking for continued assist to get his nation by the winter.

Russia is more and more relying on drone strikes towards Ukraine’s vitality grid and civilian infrastructure and sowing panic with hits on Ukrainian cities, ways that European Commission President Ursula von der Leyen referred to as “war crimes” and “pure terror” on Wednesday.

Diplomats are already assessing extra sanctions to return. But Orban’s perceived friendliness towards the Kremlin makes life more durable. Even although the earlier EU sanctions focusing on Russia have been accredited unanimously, it has more and more grow to be troublesome to maintain Orban on board by agreeing to exemptions.


Associated Press writers Lorne Cook in Brussels and Geir Moulson in Berlin contributed to this report.


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