The price of natural gas in Europe fell for the third day, after the European Commission insisted on interventions on the market to mitigate the effects of the worst energy crisis in recent decades, reports Bloomberg.
On Tuesday morning, at the TTF hub in Amsterdam, where reference prices for natural gas in Europe are set, quotations for next month fell by 4.3%, reaching 182.33 euros for one Megawatt hour (MWh), and in the previous two sessions the decline was 14%. In the spring, at the TTF hub in Amsterdam, the quotations reached the record level of almost 335 euros for one MWh.
The president of the European Commission, Ursula von der Leyen, would present on Wednesday a version of the five-point plan, given that the EU wants to reduce energy consumption and provide liquidity, in order to prevent the expansion of the crisis, according to Agerpres.
“A cocktail of market reforms and price caps will likely be introduced, which will fundamentally change the way energy markets in Europe have operated since deregulation in the early 2000s,” analysts at Citigroup Inc. said.
While political measures are being worked out, gas continues to be pumped into storage ahead of the onset of the cold season.
Gas storage capacities in Europe are 84% full, above the average of the last five years, reaching a level of 88% in Germany. And in October, gas storage usually continues, before heating demand increases.
As part of its plan, the EU wants to reduce energy demand and cap the excessive revenues of companies that produce electricity from sources other than gas. A cap on the price of energy from renewable sources, lignite or nuclear energy could be imposed.
Record energy costs have already forced big consumer industries such as fertilizer and aluminum makers to cut production, and prompted EU governments to pump billions of euros into household support schemes.
There is already a tightening in the global LNG market, following the recovery of economies after the pandemic, even before the war in Ukraine added to the difficulties in the market.