Viewpoint: EU Gas Price Cap Proposal Ignores Supply Question

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The proposal by the European Commission to implement a price cap on the Dutch TTF, Europe’s benchmark gas hub, continues to ignore that the underlying problem of Europe’s energy predicament is a supply shortage. Once again it must be said that instead of shortsighted political wins by distorting the market via policy interventions, Brussels should look at solving the long-term supply security question and support it with effective demand-side measures until incremental volumes can be found. A focus on attracting supply, ensuring liquidity, guaranteeing a level playing field among countries, and eliminating regulatory and physical congestion points across the bloc would be infinitely more effective than intervening and constraining a market that works well and responds to fundamentals effectively. This should be the focus of a Nov. 24 meeting by EU energy ministers, which could decide the fate of the gas price cap.

Gas Supply, Gas Prices, Gas Demand, Gas Inventories, Gas Futures and Derivatives, Gas Spot Markets, LNG Supply, LNG Trade, LNG Prices, Policy and Regulation, Ukraine Crisis
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