«Brussels proposes price limits» – Corriere.it
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The common agreement and the risk of cross vetoes
The joint agreement is still precarious and could be blown if German Chancellor Olaf Scholz or some other leader vetoes it (and a joint agreement seemed even further away in the morning, when a document signed by the Netherlands and Germany was circulating).
However, ministers unanimously today from Brussels are proposing two options. The first is “to amend the references to the Ttf index in contracts (for gas supply, ed) through European legal or regulatory measures “. The Ttf index (from Title Transfer Facility, the name of the Amsterdam platform where gas futures are exchanged) in recent months has been subject to enormous fluctuations and speculative effects with the impact of various developments related to the war. Eliminating or reducing the role of this index would certainly give much greater stability to the price of raw materials for businesses and households in Europe. But the ministers’ document acknowledges that there are “diverging opinions” on the possibility of intervention on supply contracts already in force.
The gas price “ceiling” or “corridor”
The ministers therefore propose to the Commission a second option: “a price ceiling or corridor on the wholesale market and the creation of a separate mechanism to match supply with demand if the price ceiling is reached ”. Here, too, the ministers’ document acknowledges that there are “diverging options»On the feasibility and economic efficiency of this option.
The joint purchasing platform
But the Commission will at least have to present proposals on both routes to contain the price of gas, because all the energy ministers – including those of Germany and the Netherlands – are asking for it. It will then remain to be seen whether the Social Democrat Scholz, for Germany, will be equally open to negotiation at the top of his (green) vice-chancellor and head of Economy and Energy Robert Habeck.
In the meantime, however, all the ministers are in agreement on several other points: to establish a platform for joint purchases; coordinate strategies for storage and diplomacy for the purchase of gas from third countries; develop a price index for liquefied gas, which reduces the speculative effect of the TTF; and finally the commitment to reduce energy consumption.
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