Europe's gas price cap leaves some nations dismayed, saying it's far too high

Several EU subordinate states are not blessed with the bloc's projected headdress connected earthy state prices — astatine 275 euros per megawatt hr — which aims to forestall sky-high costs for consumers.

Introducing a headdress connected state prices has been 1 of the much arguable measures for Europe amid an acute vigor situation pursuing Russia's penetration of Ukraine.

The 27 EU leaders gave governmental backing to the idea successful precocious October, aft respective months of discussions. But, a fistful of nations are demanding factual safeguards earlier greenlighting the proposal, portion others accidental the headdress is excessively high.

"A terms headdress astatine the levels that the committee is proposing is not successful information a terms cap," Kostas Skrekas, Greece's situation and vigor minister, told CNBC's Julianna Tatelbaum Tuesday, hours aft the projected level was acceptable by the European Commission, the enforcement limb of the EU.

"So [a] terms headdress astatine 275 euro is not a terms cap, cipher can, tin basal buying state astatine this costly terms for a agelong time. We surely judge that the terms headdress beneath 200 euro, betwixt 150 and 200 euro would beryllium much realistic," helium added.

EU vigor ministers are owed to conscionable Thursday to statement the terms headdress proposal.

Poland, Greece, Belgium and Spain are among the nations supporting the cap. The Netherlands and Germany person been much skeptical astir the benefits of the measure. Presenting a headdress that looks pugnacious to implement, successful practice, could beryllium a mode for the European Commission to bring each the 27 nations unneurotic connected the issue.

"It volition beryllium a gathering with grumpy people," an EU official, moving for 1 of the subordinate states and who preferred to stay anonymous owed to the delicate quality of the discussions, told CNBC regarding the upcoming meeting.

The aforesaid authoritative said the committee needs to contiguous further guarantees connected however the measurement volition not distort markets.

Speaking astatine a property league Tuesday, Kadri Simson, the European commissioner for energy, said the connection is "balanced" and it volition assistance the bloc debar excessively precocious prices.

A radical of vigor exchanges successful Europe, Europex, besides said earlier this week it was "deeply concerned" astir a marketplace correction mechanism, fixed it could interaction fiscal stableness — but besides information of supply.

Simson said the proposal, known arsenic the Market Correction Mechanism oregon MCM, has taken this into information and "the risks are minimal" for supply.

The committee projected the instauration of a headdress erstwhile prices connected the front-month Title Transfer Facility [TTF] — Europe's main benchmark for earthy state prices — reaches 275 euros per megawatt hr and erstwhile prices are 58 euros ($59.53) higher than the LNG notation terms for 10 consecutive trading days wrong the 2 weeks. Both conditions request to beryllium met for the headdress to beryllium triggered.

Dutch TTF prices reached a historical precocious of 349.9 euros per megawatt hr successful August. Under the proposal, the terms headdress would person not been triggered arsenic it was lone a little spike.

"This is not a metallic bullet," Simson said astatine a property league Tuesday. She added, however, the measurement provides "a almighty instrumentality that we tin usage erstwhile we request it."

"Everybody is alert of the imaginable risks but determination is simply a wide expectation. We volition nonstop signals that contempt the hard situation, we volition not wage astatine immoderate the marketplace level volition bring to marketplace participants — similar it happened successful August," she said.

European earthy state prices closed astatine 124.5 euros per megawatt hr connected Tuesday evening.