The Member States of the European Union agreed on Monday a mechanism to limit wholesale gas prices for three consecutive days when they exceed 180 euros per megawatt hour -MWh- (a similar figure in dollars), indicated the European Council.
This limitation mechanism, adopted by the 27 countries after several weeks of discussions, will only be activated when the price level is at least 35 euros higher than the average international price of liquefied natural gas (LNG), according to the statement.
The European energy ministers, meeting in Brussels, “have reached an important agreement that will protect citizens from the escalation of energy priceswith a realistic and effective mechanism that includes the necessary guarantees for security of supply and stability of financial markets,” said Czech minister Jozef Sikela, whose country holds the rotating EU presidency.
The mechanism will apply to futures contracts in the gas markets.
Directly affected by the move, Russia called the limitation “unacceptable.” “It is a violation of price fixing (…) Any reference to a “limit” (on prices) is unacceptable,” said Kremlin spokesman Dmitri Peskov, quoted by Russian press agencies.
The gas contract for delivery within a month was quoted this Monday in the TTF (the reference gas market) at about 110 euros/MWh.
The TTF is the de facto gas exchange of the EU and its price is used as a reference for most transactions on the mainland.
