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EU leaders with ‘solid roadmap’, but still unequivocal on gas prices cap

European Union leaders ended another debate on the bloc’s response to the energy crunch without agreement on whether to cap gas prices, deciding in the early hours of Friday morning to keep examining options to put a ceiling on costs.

The EU is grappling with high energy prices driving inflation and raising the prospect of recession across the continent, a situation aggravated by Russia slashing gas flows following its February invasion of Ukraine.

The 27 countries have already agreed to fill gas storages and claw back revenues from energy firms to spend on helping consumers with crippling bills.

At a summit in Brussels on Thursday that ran late into the night, EU leaders eventually backed proposals made by the European Commission this week to launch an alternative price benchmark for liquefied natural gas and voluntary joint gas buying, although laws to make this happen will need to be negotiated over the coming weeks.

However, after weeks of negotiations among EU country leaders, ministers and diplomats on the topic, the summit concluded at around 2am in Brussels without a final decision on an EU gas price cap.

“We do now have a very good and solid roadmap to keep on working on the topic of energy prices,” the European Commission head Ursula von der Leyen said.

In their summit conclusions, EU leaders asked their ministers and the EU’s executive to “submit concrete decisions” on a “temporary dynamic price corridor on natural gas transactions” that would limit price spikes, and a price cap on gas used to generate electricity.

This should include a “cost and benefit analysis” of capping gas prices for the power sector, the conclusions said, reflecting some countries’ concerns that it could boost gas use or divert electricity exports to non-EU countries like Britain that do not have the cap.

The leaders did not give a timeframe for when decisions should be made on the price caps. EU energy ministers will discuss the measures on Tuesday.

EUR 40 bn aid

What the European Union has agreed on is the EUR 40 bn sum to support households and small and medium-sized businesses in the wake of the ongoing energy crisis.

As Ursula von der Leyen explained, the funds come from the previous multiannual Community budget from an unused pot.

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