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Deep divisions among European Union member states emerged on Tuesday as EU officials gathered to discuss the energy crisis and the bloc’s measures to respond to it.
Some EU member states argue there should be a price cap on natural gas, others want a cap on LNG prices only, while another group is opposed to EU-backed subsidies to households to help them with their energy bills.
Ministers are gathering in Luxembourg ahead of a leaders’ summit later this week, and some spoke to the media about their countries’ respective views on how the EU should tackle the energy crisis and soaring energy prices.
Croatia and Lithuania, for example, are in favor of a cap on wholesale gas prices. Slovenia, for its part, wants a cap on LNG only.
“Slovenia will advocate introducing the so-called dynamic price cap for liquefied gas as soon as possible, if possible - now,” state secretary at the foreign ministry, Marko Stucin, said, as quoted by Reuters.
Several EU member states, as well as the Commission, have been reluctant to propose a cap on LNG, arguing that a cap on prices could weaken LNG sellers’ economic incentive to send cargoes to Europe when it needs them most.
Apart from a gas price cap, Croatia also pushes for joint purchases of gas among the EU.
Slovakia, it emerged, wants a reform to decouple electricity prices of gas-generated power from the prices of electricity generated from other sources. Slovakia also wants direct EU subsidies to businesses and households.
But Finland is opposed to direct subsidies from the EU, while it has recently become more open to a “temporary” gas price cap.
The European Commission is expected to unveil today a new package of proposed measures to ease the energy crisis. However, the proposal is unlikely to include an immediate cap on natural gas prices, as EU member states remain divided over the issue, according to a draft document seen by Reuters.
The European Commission is expected to propose a “maximum dynamic price” on the natural gas futures traded at the Title Transfer Facility (TTF), the benchmark for the European gas prices, as a “last resort,” the document showed.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.