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Belgium calls for price cap on all gas EU imports, not only from Russia

·2-min read
Gas is switched on a gas cooking range in a private home in Sint-Pieters-Leeuw

By Gabriela Baczynska

BRUSSELS (Reuters) -European consumers need a cap on wholesale gas prices rather than just a "political" one on Russian imports, Belgium's Energy Minister Tinne Van der Straeten told Reuters on Thursday.

Speaking ahead of emergency European Union talks aimed at lowering runaway energy prices on Friday, Van der Straeten said Belgium wants an EU-wide, dynamic price cap on exchange traded gas linked to Asian markets to ensure security of supplies.

The price cap on Russian pipeline gas imports, proposed by the EU executive ahead of Friday's ministerial talks, has so far had a mixed reception among the bloc's 27 nations.

European power prices have risen sharply up since economies began to emerge from the COVID-19 crisis last year, with the increase fuelled by Russia cutting gas supplies in retaliation for Western sanctions imposed over Moscow's invasion of Ukraine.

"Our intention first and foremost is to bring prices down. A cap on only Russian gas won't bring prices down," Van der Straeten said. "A cap on just Russian gas is purely political."

"There is not that much Russian gas coming to Europe, so I don't see the added value of that," the Green Belgian politician said, adding that Spain, Poland and Luxembourg were in favour of a cap, while Germany had reservations.

"We have to intervene at wholesale market level... so that it can have effect on energy bills," she said, adding the cap should be monitored closely and have a back-up mechanism in place for when global LNG prices break the EU ceiling.

The Netherlands, traditionally against market interventions, backed the narrower, Russia-only option.

Van der Straeten said energy ministers should give clear guidance to the European Commission to act to cut energy prices, and that the cap could then take effect in a matter of days.

"It's absolutely our intention to have this (in place) before winter heating really starts," she said, adding the measure to bring down prices should take effect in October.

She said joint EU gas purchases must be brought forward and that the bloc needed an energy market price reform that would split electricity produced from gas from that coming from non-fossil sources like nuclear power or renewables.

For the time being, tapping into windfall profits made by energy companies - as proposed by the Commission - was acceptable as it would give EU countries money for direct support for those struggling with high energy bills.

(Reporting by Gabriela Baczynska; Editing by Carmel Crimmins and Alexander Smith)