EU summit moves forward on joint gas purchases
In the dispute over measures to combat high energy costs, EU leaders have reached a compromise, although the details are not yet clear. The proposals include EU states making joint purchases of gas, partly on a mandatory basis, as well as a "dynamic price corridor". Commentators see much need for clarification.
No clue whether and how this will work
Economists Tito Boeri and Roberto Perotti voice scepticism in La Repubblica:
“As with tango, it takes two to set a price cap. But Russia had already threatened on 12 October to cut off supplies to any country that tried to introduce a one. ... In addition, Germany and the Netherlands have opposed the move. ... With its solution the Council is now trying to keep them happy: the price cap must take account of market developments by adjusting to the minimum - and especially the maximum price. In short, it must be dynamic. It is not clear who will make these adjustments or how, and the Commission itself has no clear ideas about how to proceed.”
The market will take care of the rest
De Volkskrant argues that a price cap is unnecessary:
“It is good that the EU member states have decided to purchase gas jointly so as to avoid bidding against each other again in the future. That is the main outcome of the negotiations at the end of last week. ... There doesn't have to be a price cap as long as countries like Germany and the Netherlands promise that they will never again provide endless guarantees for losses. Such guarantees must be capped. Then the market will solve the problem of soaring prices on its own.”
Who benefits from Orbán going it alone?
Hungarian Prime Minister Viktor Orbán is boasting about having pushed through exemptions for his country. Népszava is not convinced:
“Pricing is complicated. Easier to answer, however, is the question of whether the Hungarian head of government was right when he claimed he had negotiated successfully once more by 'fighting' for the EU agreement not to affect Hungary's long-term deal with Gazprom. Why should that be good? Because this way the price at which we bought Russian gas can continue to be kept secret? Or because it allows the Russians to finance their aggression with Hungarian money? Who benefits when we buy the gas at a higher price than the rest of Europe?”
Berlin protecting its own economy
Hospodářské noviny criticises Germany's stance above all on energy prices:
“The 200 billion aid package approved by the German government deals a blow to joint progress. Robert Habeck, the Minister for Economic Affairs, can repeat the words 'European solidarity' until he's blue in the face, but the state aid for the German economy is so extensive and hard to match financially for most other countries that it will have a far-reaching negative impact on non-German industry in Europe. So putting aside the soothing diplomatic words, how do things look? Pretty miserable.”
Brussels ignoring members and options
Efimerida ton Syntakton criticises the EU Commission:
“The elementary majority rule in a democracy with 27 countries would require the European Commission to account for the fact that at least 15 countries support an EU-wide gas price cap. Or alternatively, to uncouple the price from wholesale electricity prices. This is referred to as the 'Iberian model', which in the few months since its implementation has led to significantly lower electricity prices in Spain and Portugal. However, all these efforts and public proposals are being conspicuously ignored by the European Commission.”
Emergency brake perhaps not necessary
With gas prices down somewhat De Standaard is cautiously optimistic:
“These are hopeful signs that may make a European correction mechanism a little less urgent. That also seems to be the tone of the Commission's proposal this week, in which a 'dynamic' price cap was presented only as an extreme emergency measure. The hope that the emergency brake will never have to be used was not expressed, but a scenario in which the market calms down to such an extent that state intervention is less necessary no longer seems completely out of the question.”
At least a symbolic step
Joint purchasing of 15 percent won't be enough, tagesschau.de suspects:
“The purported purchasing giant the EU is dwarfing itself with this plan. It's good for the gas suppliers but bad for gas consumers, because it will probably have little effect on the high prices. Nevertheless it would be a symbolic step because Europe would at least be making an attempt to close ranks a little in this unprecedented energy crisis. So far there had been no sign of this. On the contrary, each member state has tried to secure what it can for itself more or less successfully. And Germany, of all countries, has set a rather bad example.”
This is not what unity looks like
Lidové noviny is less than impressed by the EU Commission's proposals to rein in gas prices:
“The Union is so split on this issue that its very existence is threatened. While some countries want to cap gas prices, others reject what they see as needless intervention in market mechanisms. And while the former claim that current gas price levels are unbearable for businesses and households, the latter fear consumers won't cut down on gas consumption unless high prices don't force them to. ... Rich EU countries have an advantage, their companies are out-competing the poorer ones. In Covid times, that was forbidden - precisely to prevent individual countries from competing with each other in providing state support to companies.”