Natural gas increased again as traders weighed if Europe’s steps to contain the energy crisis will be enough to curb costs of the fuel after a price cap proposal was ditched for lack of consensus.
(Bloomberg) — Natural gas increased again as traders weighed if Europe’s steps to contain the energy crisis will be enough to curb costs of the fuel after a price cap proposal was ditched for lack of consensus.
Benchmark futures rose as much as 3.3%. The European Commission’s radical intervention plan includes raising 140 billion euros ($139 billion) for consumers from energy companies earnings, as also mandatory curb on peak power demand and boosting liquidity. But uncertainties remain on how the measures will be implemented as member states are divided and have to sign off on the Commission’s plans.
The proposals also didn’t include any solutions on how to add gas supply to a market that’s been tight ever since Russian shipments were cut. The EU is struggling to rein in the unprecedented crisis that hitting the economy and driving inflation. Governments are under mounting pressure to act with the official start of the heating season just about two weeks away.
The Dutch front-month gas contract, a benchmark for Europe, was 1.4% higher at 221 euros per megawatt-hour as of 7:28 a.m. in Amsterdam. They rose 14% in the previous two sessions.
More stories like this are available on bloomberg.com
©2022 Bloomberg L.P.
