European Union regulators launched a new reference price for LNG, as part of plans to cap benchmark gas prices if they increase like they did last year after Russia curbed supply.
According to Reuters, the reference, based on global LNG prices, will be used along with the European gas price to set a cap on benchmark gas in case prices rise to a certain level though for now both are trading well below such levels.
More specifically, from February 15, EU gas will be capped if the benchmark price exceeds 180 eur/MWh for three days and is 35 eur/MWh above the LNG reference price.
That LNG reference price was assessed at 55.21 eur/MWh, by the Agency for the Cooperation of Energy Regulators (ACER), Reuters adds.
European gas prices topped 140 eur/MWh in mid-December but have fallen since amid unusually warm winter weather and near-full EU storage tanks.
What is more, the European Commission is also considering setting a $100 per barrel price cap on premium Russian oil products like diesel and a $45 per barrel cap on discounted products like fuel oil.
As Reuters reports, the proposal was sent on January 26 to EU governments, whose representatives will discuss it at a meeting on January 27. The aim is to reach a deal before the price cap on imported Russian oil products is to come into force on February 5, in line with an agreement by G7 countries.
The price cap on Russian oil products comes after a $60 per barrel cap imposed on Russian crude on December 5th as G7 countries and the 27-nation EU as a whole seek to limit Russia’s revenue from its oil exports without disrupting world supply.
The price caps imposed by the G7 and the EU aim to obstruct Russia’s ability to finance its war in Ukraine.
