EU Energy Chief Suggests Winter Gas Price Caps Are Possible If Countries Agree

The European Union may establish a gas price ceiling this winter to avoid excessive price spikes, according to the bloc's energy chief, but only if member states grant Brussels the right to propose the policy.

Despite months of high gas prices caused by Russia's reduction in supplies, the 27-nation EU is considering a price ceiling; but, after weeks of deliberations, Brussels has not yet made a formal proposal to make it happen.

The European Commission announced last week that it may submit a formal proposal for a temporary "dynamic" restriction on Dutch Title Transfer Facility (TTF) gas trading if EU members want it.

The EU's energy commissioner, Kadri Simson, suggested that the limit might yet be enforced before winter. The Commission has warned that the price ceiling would be used as a "last resort" if prices fly out of control.

Simson told an EU parliamentary committee, "This Dutch TTF gas benchmark limit might be applied this winter if we acquire the mandate."

EU nations might grant this mandate during a November 24 emergency meeting of EU energy ministers, when they will determine whether to recommend that Brussels propose the limit.

As of the energy ministers' meeting on Tuesday, however, an agreement on the idea remained difficult, as nations remained split.

Germany is the head of a small group of governments that oppose price limits, stating that restricting the amount firms can pay for gas would hinder their ability to get adequate gasoline as Europe enters the winter season with limited Russian supply.

Italy, Belgium, Poland, and twelve other governments are requesting an EU-wide price cap, citing the inflationary impact of recent gas price hikes on their economies.

Unusually, the measure may be approved by a reinforced majority of 15 ministers from EU member states. However, German chancellor Olaf Scholz claimed last week that the vote of ministers will be "unanimous," meaning that a single country may vote against the proposal.