Economist explains why Germany is still using Russian gas
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EU countries are split over whether to impose a cap on oil and gas prices in order to tackle the energy crisis that is hitting the bloc hard. Influenced by increased demand during a post-pandemic recovery, along with geopolitical tensions between Russia and the West pushed wholesale gas prices in the EU to record levels in the last quarter of 2021.
In an effort to curb the energy crisis, a growing number of EU countries are calling for setting a limit on gas prices, which continues to affect the cost of living for families and puts a strain on businesses.
Two countries, Netherlands and Italy, are at loggerheads with each other over whether to impose a price cap.
Amsterdam is joined by countries like Germany who have voiced their scepticism most sceptical about the measure.
According to Dutch Prime Minister Mark Rutte, imposing the price cap “has risks”.
Meanwhile, Italy is on the opposite on the debate, demanding that the EU intervene in the energy markets.
Rome is also joined by Spain, Portugal, Belgium and Greece in calling for a price cap.
Italian Prime Minister Mario Draghi said: “Our governments have done their part and will continue to do so, but energy policy interventions cannot weigh only on the national budget, they must be structural.”
Thursday, Mr Draghi met with his Dutch counterpart, following which he noted that while their position still diverge, “progress has been made”.
After the visit, Mr Draghi told reporters that Mr Rutte promised to “examine all issues in favour which is much more than he had done so far.”
He added: “Breaking away from gas dependence is difficult, but this is a prospect if the war continues with the atrocities we are seeing.”
This meeting occurred on the same day that several EU lawmakers demanded a total ban on oil, coal and gas imports from Russia.
However, the move to sanction Russian energy is facing pushback from several EU nations, many of whom are extremely dependent on Moscow for their oil and gas needs.
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Leading this pushback is Hungarian President Victor Orban, a key ally of Putin.
Mr Orban, who has just been re-elected to serve a fourth presidential term, has stressed that blocking Russia’s oil and gas imports are a “red line” as it would “kill Hungary”.
Part of his presidential campaign, which took him to victory on Sunday, was based on a pledge to maintain the security of gas supply for households.
Joining him in stopping gas sanctions are Austria, Italy and the Netherlands, who all fear that the move would cause chaos to their economies and energy security.
Up to a third of the EU’s gas is supplied by Russia, and it also handed Putin a staggering €48.5billion (£38billion) for crude oil imports in 2021, and €22.5billion (£19billion) of petroleum oils other than crude.
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