The introduction of a price cap may lead to a cut in gas supply to the EU
New Delhi: Chancellor of Germany Olaf Scholz while speaking in the Bundestag (the German federal parliament) said, A political decision to cap energy prices is always fraught with risks and can lead to a reduction in gas supplies to Europe.
“We are considering the proposals of the European Commission very carefully. A politically set price cap always carries the risk that producers will sell their gas somewhere else, and we, Europeans, will end up not with more gas, but with less gas,” he warned.
“In this regard, the EU should closely coordinate its actions with other gas-consuming countries, such as Japan and South Korea, so that we do not enter into a mutual competition. At the same time, we are also talking with other producers about price-matching,” Scholz said.
“I am convinced that such countries as the United States, Canada, and Norway, which together with us support Ukraine on the basis of solidarity, are interested in having affordable energy in Europe.”
The project aimed at capping the price of gas is on the agenda of the European Council meeting, which will be held on October 20-21 in Brussels.
On September 25, a group of 15 countries called on the European Commission to impose a price cap on all imported gas. However, Germany, Denmark, and the Netherlands opposed such a restriction at the time, arguing that it would harm efforts to contain the energy crisis in Europe. Belgian Energy Minister Tinne van der Straeten has proposed considering a “flexible price corridor” as a possible measure to deal with rising gas prices. The President of the European Commission stated the need to introduce a cap on prices only for Russian gas.
(Vinayak)
