“Our proposal will raise more than €140 billion for Member States to immediately cushion the blow. And because we are in a fossil fuel crisis, the fossil fuel industry also has a special task. The big oil, gas and coal companies are also doing huge profits. So they have to pay a fair share – they have to contribute to the crisis,” von der Leyen said in her 2022 State of the Union address today. The EU will also try to reform the electricity market to decouple the dominant influence of natural gas on the price of electricity, he added. “These are all emergency and temporary measures that we are working on, including our discussions on price caps,” the Commission president said, without referring to specific price caps for natural gas or only for Russian gas. This was the only reference to price caps in von der Leyen’s speech today. Since von der Leyen first said last week that the Commission would work on a price cap on Russian gas to deprive Putin of revenue for the war in Ukraine, deep divisions have emerged among its member states. EU on gas price caps. At least ten of the 27 governments are said to oppose such a move due to concerns that Putin may retaliate by completely cutting off gas supplies across Europe. Germany, Europe’s largest economy and the EU member most affected by the now-closed Nord Stream pipeline, does not support the plan. Another group of EU countries, which includes France and Poland, pushed for a price cap on all imported natural gas. However, the European Commission is wary of the idea because a cap would hurt Europe’s ability to pump large quantities of LNG if prices elsewhere are higher. Although the EU has exceeded its gas storage target for this time of year, “unfortunately this will not be enough”, von der Leyen said today, adding that the EU must continue to seek to reduce the price of natural gas. The EU and Norway – a major supplier of natural gas and an ally of the bloc – agreed to set up a task force on the issue. The Commission will also work to create “a more representative benchmark” for gas prices in Europe from the Dutch TTF hub, von der Leyen added. By Michael Kern for Oilprice.com More top reads from Oilprice.com:
