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Cap the cost of all gas imports to EU, Belgian PM says

by host

The European Union should impose a radical plan to cut the cost of energy by capping the price paid for gas imported from anywhere else in the world, Belgian Prime Minister Alexander De Croo said in an interview with POLITICO.

De Croo’s proposal goes significantly beyond the blueprint outlined by European Commission President Ursula von der Leyen, who suggested a bloc-wide cap only on gas imported from Russia.

His intervention lays bare the divisions within the EU over how to respond to the mounting economic crisis, fueled by Russian President Vladimir Putin’s invasion of Ukraine. EU leaders say Russia has weaponized its energy resources by cutting gas supplied to the bloc in retaliation for sanctions imposed on Moscow by Brussels in response to the war.

The result has been a spike in energy prices, which has driven already high inflation and threatens a social and economic emergency for many countries in the region.

Speaking to POLITICO on Thursday, De Croo called urgently for a “broad” price cap on all types of gas, including from Russia.

For the Flemish liberal, the “key measure” is to cap the price of gas. “And that needs to [include] all types of gas,” he said. The prime minister urged fast action on far-reaching measures, warning that moving initially with only a “first step” would be a “big mistake.”

Under De Croo’s proposal, the cap on all gas imports would need to be implemented in a “dynamic way” to ensure that there was still a reason for traders to sell gas to Europe rather than, for example, in Asian markets.

Asian prices are currently about half of those in Europe, De Croo said. If Europe sets the price cap 5 percent higher than Asia, he explained, “all traders in the world will still continue to sell in Europe, because you still get a price that is more attractive than Asia.”

Earlier on Thursday, Belgium’s Energy Minister Tinne Van der Straeten went even further and said Belgium would not support the Commission’s plan to impose a price cap specifically on Russian gas imports.

“A cap on Russian gas only is a purely political objective,” the Green politician told reporters. “I don’t see the added value in that. We will not agree to this.”

De Croo has been a strong advocate of capping gas prices. Since March, he has been lobbying EU leaders to convince them to back his plan for introducing caps on soaring energy costs.

While momentum is growing in some capitals for a global cap on gas import costs, countries such as France have voiced concerns about the idea, amid fears that it would see a shortage of supply as sales go to Asia.

Germany, too, said it was “skeptical” about the idea of a cap on Russian gas imports, to which De Croo responded: “I have the feeling that there is much more openness to this idea. Because I think that everyone understands that your own fiscal pockets, for whatever country it is, will never be deep enough to cope with this.”

Other countries like Poland and Greece are also backing the idea of a price cap on gas from all sources.

Barbara Moens contributed reporting.

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