• 4 minutes Energy Armageddon
  • 6 minutes How Far Have We Really Gotten With Alternative Energy
  • 10 minutes Wind droughts
  • 1 day "Biden Is Running U.S. Energy Security Into The Ground" by Irina Slav
  • 1 day GREEN NEW DEAL = BLIZZARD OF LIES
  • 6 hours "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 5 hours "How to Calculate Your Individual ESG Score to ensure that your Digital ID 'benefits' and money are accessible"
  • 13 hours Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 7 days "Forget Oil, The Real Crisis Is Diesel Inventories: The US Has Just 25 Days Left" by Zero Hedge - 5 Stars *****
  • 6 hours The Federal Reserve and Money...Aspects which are not widely known
  • 5 days Is Europe heading for winter of discontent with extensive gas shortages?
  • 13 hours "Europe’s Energy Crisis Has Ended Its Era Of Abundance" by Irina Slav
  • 12 hours "Dodgy Demand Data? The Oil Price Collapse Conspiracy" by Alex Kimani
  • 7 days "The Global Digital ID Prison" by James Corbett of CorbettReport.com
  • 8 days Goldman Betting on Cryptocurrencies
  • 12 days Сryptocurrency predictions
Charles Kennedy

Charles Kennedy

Charles is a writer for Oilprice.com

More Info

Premium Content

EU Delivers Nat Gas Price Cap Without “Silver Bullet”

  • The European Commission unveiled a long-awaited price cap plan for natural gas on Tuesday.
  • The price cap proposal is for month-ahead derivatives on the Dutch natural gas benchmark TTF and would be in place for two weeks. 
  • EU Energy Commissioner Kadri Simson: “This is not a silver bullet that will bring gas prices down,”.

The European Union has unveiled a long-awaited natural gas price cap plan to protect consumers from soaring energy prices in the wake of Russia’s invasion of Ukraine, capping prices for the entire bloc at 275 euros (~$272) per megawatt hour, Reuters reports. 

The price cap proposal is for month-ahead derivatives on the Dutch natural gas benchmark TTF and would be in place for two weeks. 

The plan is being presented as a failsafe that would not be set in motion unless natural gas prices reached above specific levels for 10 straight days during that two-week period, the Wall Street Journal said, citing the European Commission. 

“This is not a silver bullet that will bring gas prices down,” WSJ quoted EU Energy Commissioner Kadri Simson as saying. “But it provides a powerful tool that we can use when we need it.”

Last week, EU officials warned that once a gas price cap was initiated, it would be “immediately” revoked in the event that there were any negative economic consequences for the bloc, Euronews reported. 

That statement reflected mounting fears that a market intervention of this nature would result in the diversion of cargoes of liquefied natural gas (LNG) to Asia. 

The potential for LNG cargoes to be diverted was illustrated in recent reports about rising numbers of LNG vessels waiting on the coast of Europe for prices to rise before offloading. 

"We have put a lot of thought into what can go wrong. If something goes wrong, we will pull the plug," Euronews cited a senior EU official, speaking on the condition of anonymity. "We will push the button."

The European Commission's price cap proposal, unveiled Tuesday by the European Union, still requires the approval of all member countries in order to be implemented. Further discussions will take place on Thursday, according to WSJ. 

By Charles Kennedy for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment
  • Mamdouh Salameh on November 22 2022 said:
    The EU’s natural gas cap is toothless, futile and impractical. There is also the genuine risk of LNG cargoes being diverted from Europe to the Asia-Pacific region.

    Because of shortages, there is a huge competition for whatever LNG is in the market and a real possibility of LNG prices shooting up further.

    The fact that China has rushed to sign a 27-year LNG deal with Qatar is a clear indication of the competition for the remaining LNG in the market before additional new capacity comes online from 2026 onwards.

    Despite the cap, the hapless EU won’t escape paying even more staggering prices for LNG supplies with the United States milking it for every particle of LNG it provides.

    Dr Mamdouh G Salameh
    International Oil Economist
    Global Energy Expert

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News