President of the European Commission (EC), Ursula von der Leyen has said that the Union needs to impose a price cap on Russian pipeline gas. She argued on Friday that such price cap would obstruct President Vladimir Putin’s attempts to manipulate the European energy market.
“I firmly believe that it is now time for a price cap on Russian pipeline gas to Europe,” Reuters quoted von der Leyen in a report, adding that, “A gas price cap can be proposed at European level, and there also is a legal foundation at European level to skim profits temporarily as an emergency measure at a time of crisis.”
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The agency said the idea of taxing the profits of energy companies in Europe has been gathering momentum in recent weeks. Gas flows from Russia to Europe have been significantly reduced over the last couple of months, with Russia hinging it on technical issues.
Russia said it has issues with the absence of enough turbines for compressor stations along the way. However the EU has countered with claims that Russia is using gas supply as a weapon against Europe.
The biggest supply channel of Russian gas to Europe, Nord Stream 1, is operating at 20% capacity. It was shut down last Thursday, the second time in two months, for a three-day maintenance round.
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Von der Leyen’s call for a gas price cap comes as G7 discusses a price cap on Russian oil exports in a bid to curb Moscow’s oil revenues, which the group says would force it to end the war in Ukraine.
On the other hand, Russia has announced it would adopt the policy of selling oil only to friendly that is countries that are not implementing an oil price cap “Companies that impose a price cap will not be among the recipients of Russian oil,” Kremlin spokesman Dmitry Peskov said last Friday, echoing a statement made the day before by Deputy Prime Minister Alexander Novak.