“Not everyone is ready to take risks”: how the EU is trying to overcome the energy crisis

The heads of the countries of the European Union failed to reach an agreement on a new package of measures to combat the energy crisis, proposed earlier by the European Commission.

Instead, after a ten-hour discussion, they put forward a list of demands and instructions on how existing initiatives should be finalized.

“The European Council calls on the Council (EU. -

) and the European Commission to immediately submit for consideration specific decisions on additional measures, as well as on the proposals of the EC, assessing their impact primarily on existing contracts ... and taking into account the difference in the energy balance and national conditions (different countries. -

) ”, - the final statement of the meeting of the European Energy Council says.

It is noted that the European Council recognizes the need to accelerate and intensify in terms of reducing energy demand, abandoning the rationing of gas consumption, as well as ensuring the supply of blue fuel and reducing prices for it.

Among the measures that European leaders consider necessary to finalize are the joint purchase of gas, energy solidarity in the event of interruptions in the supply of this type of fuel, the creation of a dynamic corridor that determines the marginal exchange price for gas and a new pricing mechanism, as well as the expansion of investments to accelerate the transition to alternative energy sources.

The summit participants also stressed the need to keep the EU competitive in global markets.

“To strengthen the resilience of our economies, all appropriate instruments at the national and EU levels must be brought into play.

At the same time, Europe must remain competitive on the world stage, and it is necessary to maintain a level playing field (for all business players. -

) and the integrity of the single market, ”the communique follows.

Against this backdrop, EU heads of state expressed their commitment to working closely together to coordinate policy action.

• Baltic Pipe gas pipeline in Poland

• AP

Modest progress

Despite the lack of concrete decisions on the proposed measures, the head of the European Council, Charles Michel, on Twitter nevertheless attributed the summit participants to reaching an agreement on energy.

“There is a strong and unanimous determination to work together – like Europeans,” he said.

According to him, the leaders agreed to strive to reduce gas prices, guarantee the security of energy supplies and reduce demand for them.

The head of the European Commission, Ursula von der Leyen, also welcomed the results of the meeting, calling the instructions of the European Council "strategic guidance."

“The summit showed a strong will to come to a common decision on energy.

Of course, different states have different priorities.

But we have taken a big step forward towards common gas purchases and gas exchange rules,” the politician noted.

Recall that on October 18, the European Commission presented a new package of measures to combat the energy crisis in the Union countries.

The initiatives, in particular, involve "targeted intervention in market prices" for gas.

To this end, it is proposed to establish new rules for exchange trading in raw materials, introducing a mechanism for limiting prices through the main European gas exchange TTF, including for LNG.

The EC considered that in this way it would be possible to avoid price spikes.

In addition, it is proposed to establish rules of solidarity between EU members in the face of a shortage of gas from one of them and to carry out joint purchases of blue fuel in order to reduce "uncoordinated tenders for gas supplies between member states."

• European Council President Charles Michel and European Commission President Ursula von der Leyen

• AP

• © Geert Vanden Wijngaert

At the same time, initially the EC initiatives did not meet with wide approval in the European Union.

As Hungarian Prime Minister Viktor Orban noted on Twitter on October 20, the European Commission, in trying to set a cap on gas prices, is acting like a bar patron who wants to determine the price of beer himself.

“This will not happen.

Consumers cannot lower energy prices.

Only diversification and competition can do this,” he stressed.

In addition, as the politician noted earlier, Hungary is not the only country opposing the introduction of a gas price ceiling.

Indeed, otherwise, existing contracts may be canceled, Orban explained.

Against this background, Belgian Prime Minister Alexandre De Crot, in an interview with reporters on October 21, expressed the opinion that the EU would need a few more weeks to finally adopt new measures to combat the energy crisis.

Sunset of prosperity

Experts note that European politicians, trying to cope with the energy crisis, are mainly struggling with its consequences, and not with its causes, which are the severing of relations with the Russian Federation and the refusal of its gas supplies.

Meanwhile, the connection between European well-being and energy resources from Russia was previously recognized by the head of EU diplomacy, Josep Borrell, speaking on October 10 at the annual conference of EU ambassadors.

“Our prosperity was based on cheap energy resources coming from Russia.

Russian gas is cheap and, in theory, affordable, reliable and stable,” he noted.

At the same time, Brussels blames Moscow for the current problems, claiming that it allegedly uses energy resources as a weapon.

Although, as experts emphasize, the United States benefits in the current circumstances by supplying LNG to Europeans.

Washington's dishonest position in these circumstances is also noted by some European politicians.

In particular, this was pointed out to RIA Novosti on October 11 by French MEP Thierry Mariani.

“As soon as the EU announced its intention to reduce Russian supplies, (US President -

) Joe Biden grabbed the opportunity to supply American LNG to European markets,” he said.

A day earlier that the United States is taking advantage of the energy crisis in Europe, said the head of the French Ministry of Economy Bruno Le Maire, speaking in the National Assembly.

“We cannot agree that our American partner sells his LNG (to us -

) four times more expensive than he sells it to his industrialists,” Le Maire said.

• LNG tanker

• Gettyimages.ru

• © Feature China/Future Publishing

"Industrial potential is fading"

As Vladimir Olenchenko, senior researcher at the Center for European Studies at IMEMO RAS, noted in an interview with RT, the lack of unanimous approval of the measures proposed by the EC to combat the energy crisis is primarily due to the fact that it is impossible to unify the energy situation in each of the EU member countries.

“Of course, all the states of the Commonwealth are faced with an increase in energy prices, which entails an increase in the cost of industrial and food products.

However, each of them has its own characteristics of the development of the situation, depending on how this or that country is provided with fuel.

If the EC plan was adopted, it would only worsen the situation,” the expert believes.

However, among European politicians it is not customary to unambiguously reject any proposals of their own institutions, Olenchenko says.

In this connection, wording about the need for improvement will now be used, which, in his opinion, can drag on for a long time and never lead to a specific result.

In turn, the leading analyst of the National Energy Security Fund Igor Yushkov, in a conversation with RT, suggested that the non-acceptance of the proposals of the European Commission by the EU members is due to the fact that the EC initiatives are mainly related to the artificial limitation of prices for blue fuel and the actual change in the structure of the gas market, which suits not all states of the Commonwealth, especially those that are suppliers of energy resources.

“If LNG producers are offered a certain ceiling or corridor that will be lower than gas prices in the Asian market, then they will simply go to Asia, where they will earn more.

If there is a single buyer mechanism, this means that the EU is abandoning the market economy, which it has always been proud of, and intends to continue to dictate its conditions to the supplier, which he may simply not accept and leave Europe without energy sources at all.

In the coming winter, this option is extremely unattractive.

Not all EU countries are ready to take risks and therefore oppose the measures proposed by the EC,” the analyst explained.

He doubts that in the short term the agreement on a specific package of measures in the EU is likely, especially those that can directly affect the gas market.

“I think that they will postpone some significant decisions for the period after the end of the heating season.

They will leave only harmless moments: for example, a reduction in energy costs or a ban on the use of large amounts of electricity.

And they will only discuss suppliers from around April 2023,” Yushkov said.

Meanwhile, from his point of view, the energy crisis, which Brussels is trying to blame Russia for, was the result of the actions of the European politicians themselves, following the lead of the United States.

“In the context of the refusal of profitable energy resources from the Russian Federation, the industrial potential of the European Union is melting - production is decreasing, enterprises are closing.

Yes, in the same Germany they take credit for liberation from alleged dependence on Russia.

But at what cost?

The EU countries should soberly assess their current situation and recognize the fact that without Russian gas, Europe is not destined to become an industrial locomotive again, ”the expert concluded.