EU countries agree on Russian gas price cap

The European Union nations have agreed on a price cap for Russian gas at €180 per megawatt-hour, Reuters reports, citing the Office of the President of Czechia. 

The decision will come into effect on 15 February.

Furthermore, the EU countries have agreed that initially the price cap would not be applied to over-the-counter trades.

The decision was almost unanimous, Reuters writes. Germany, which had previously negated the possibility of an agreement, consented to the terms.

The information was later confirmed by Prime Minister of Czechia Petr Fiala. “We have negotiated a cap on gas prices and managed to reach a very important deal to secure affordable energies for European households and businesses,” he tweeted. 

The Council of the European Union also confirmed the decision.

The European Commission previously proposed to cap Russian gas at €275 per megawatt-hour. “The so-called gas market correction mechanism would kick in when the price of month-ahead contracts on the Dutch Title Transfer Facility exceeded €275 ($290) per megawatt hour and the gap between world prices was greater than €58”, Bloomberg reported last week.

On 12 December, Bloomberg reported, citing diplomatic sources, that 12 member states had demanded to decrease the previously proposed price ceiling. Lithuania, Latvia, Poland, Romania, Italy, Greece, Croatia, Slovenia, Slovakia, Belgium, Bulgaria, and Malta came out in favour of lowering gas prices.