By Kate Abnett
BRUSSELS (Reuters) – The gas price cap introduced by the European Union during its 2022 Russian gas crisis will expire on Friday, having not been triggered since its inception.
The cap would have applied if gas prices surged to unusually high levels, responding to months of soaring energy prices caused by Russia cutting gas supplies after its invasion of Ukraine.
The cap was designed to kick in if European gas prices hit 180 euros per megawatt hour – a level the benchmark EU price has not reached since the depths of Europe’s energy crisis in 2022, when it surpassed 300 euros/MWh.
The benchmark front-month gas contract at the Dutch TTF hub was trading above 52 euros/MWh on Friday – its highest since late 2023, but still far below prices during the 2022 energy crisis.
The European Commission’s decision to let the price cap expire signals that the worst of Europe’s energy crisis has passed. Despite cold snaps this winter, EU gas storage is relatively full and countries have ramped up their non-Russian gas supplies.
“Luckily, we never again got into the situation in which we could find out if the instrument was effective or not,” one EU diplomat said.
The cap had split opinion among EU countries and industry, with Germany among those concerned it would disrupt the functioning of energy markets or hamper Europe’s ability to attract gas supplies in price-competitive global markets.
Industry association Eurogas said on Friday that it supported the phasing out of emergency measures introduced during the energy crisis.
“It is difficult to assess the real effectiveness of these measures and they might create market distortions,” said Eurogas head Andreas Guth.
Other countries, including Italy, had wanted the EU to keep the price cap and redesign it to limit prices at far lower levels.
(Reporting by Kate Abnett; Editing by David Goodman)
