Norway tempers EU gas price cap expectations

Norway tempers EU gas price cap expectations

Several states in the European Union want a complete cap on the price of gas purchased by the EU, after being encouraged to reduce their consumption.

Become the first supplier of the ;Europe in natural gas instead of Russia, Norway showered on Monday the hopes of a majority of European countries who want a cap on the price of gas imports to reduce their energy bill.

Following a phone call – the second in days – with European Commission President Ursula von der Leyen, Norwegian Prime Minister Jonas Gahr Støre said he was skeptical of this idea.

We agree to have an even closer dialogue with the EU in the future regarding the various proposals that are on the table , he said in a statement.

We approach discussions with an open mind, but we are skeptical of a maximum price for gas, he added.

While the European Commission has proposed capping the price of gas from Russia, several states such as Italy note that this represents only 9% of European imports and recommend a complete cap on the price of gas purchased by the EU.

Itself opposed to this idea which could push the suppliers of liquefied natural gas (LNG) to look elsewhere, the Commission must present its project this week of legislative text containing all the emergency measures on energy.

Norway, which has largely benefited from the surge in prices exacerbated by Russia's invasion of Ukraine, has so far been tight-lipped on the question of price increases. a ceiling.

Underlining the importance of the price as a mechanism for adjusting supply and demand, Oslo returns the ball to the oil groups and recalls that European customers themselves have in the past insisted on spot contracts (at variable prices) rather than long-term contracts giving more predictability.

“A maximum price will not change the fundamental problem, namely that there is too little gas in Europe. »

— Jonas Gahr Støre, Prime Minister of Norway

As a result of the war in Ukraine, the Scandinavian country has recently supplanted Russia as the number one supplier of gas to Europe thanks to an 8% increase in its own deliveries and, above all, the fall in Russian deliveries.

The best Norway can do is to keep production high, says Norway's Minister of Oil and Energy, Terje Aasland.

Soaring prices and rising production contribute to filling the coffers of the Norwegian state.

Its oil and gas revenues could reach 1500 billion crowns (more than 197 billion Canadian dollars) in 2022 – and 1900 billion crowns next year (250 billion Canadian dollars) – shattering the record set last year. last (830 billion crowns, 109 billion Canadian dollars), according to calculations by Nordea Markets bank.

The most important contribution Norway can make in the current situation is to maintain high gas production in the future, says Norwegian Minister of Petroleum and Energy Terje Aasland.

< p class="e-p">Norwegian exports could reach a record level of 122 billion m3, it said in early May.

Norwegian exports could reach a record level of 122 billion cubic meters, making it an important player in Europe compared to other countries, notably Finland (photo).

But criticism is emerging at home and abroad, with some fearing the country is seen as a war profiteer.

As the war and power crisis what follows drags on, the sums circulating north are proving embarrassing, judged last week the British weekly The Economist.

The Norwegian embassies in several European countries are now worried about the fallout that this situation could have on the image of the Nordic kingdom, assured the Norwegian newspaper Dagens Naeringsliv.

According to Mr. Støre, the issue of a price cap had not been discussed during his previous dent interview with Ms. von der Leyen last Wednesday.

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