European Commission Calls For Price Cap On Russian Natural Gas

• European Commission head Ursula von der Leyen is calling for a price cap on Russian pipeline natural gas.
• According to the EC head, such a price cap would interfere with President Vladimir Putin’s attempts to manipulate the European energy market. 
• "A gas price cap can be proposed at European level, and there also is a legal foundation at European level to skim profits temporarily as an emergency measure at a time of crisis."

The European Union needs to impose a price cap on Russian pipeline gas, the President of the European Commission Ursula von der Leyen said today.

According to the EC head, such a price cap would interfere with President Vladimir Putin’s attempts to manipulate the European energy market, Reuters reported.

"I firmly believe that it is now time for a price cap on Russian pipeline gas to Europe," von der Leyen said, adding that, "A gas price cap can be proposed at European level, and there also is a legal foundation at European level to skim profits temporarily as an emergency measure at a time of crisis."

The idea of taxing the profits of energy companies in Europe has been gathering momentum in recent weeks.

Gas flows from Russia to Europe have been significantly reduced over the last couple of months, with Russia explaining the reduction with technical issues, notably the absence of enough turbines for compressor stations along the way.

The EU has countered with claims that Russia is using gas as an energy weapon against Europe.

Currently, the biggest conduit of Russian gas for Europe, Nord Stream 1, is operating at 20% capacity. The pipeline ws this week shut down for a three-day maintenance round, due to restart in the early hours of Saturday, again at 20% capacity.

Von der Leyen’s call for a gas price cap comes as G7 discusses a price cap on Russian oil exports in a bid to curb Moscow’s oil revenues, which the group says would force it to end the war in Ukraine.

Moscow, meanwhile, declared that it would stop selling oil to countries that have implemented an oil price cap

"Companies that impose a price cap will not be among the recipients of Russian oil," Kremlin spokesman Dmitry Peskov said today, echoing a statement made yesterday by Deputy Prime Minister Alexander Novak.

By Irina Slav for Oilprice.com

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