EU agreement on a “roadmap” to limit prices, many details to be ironed out

Progress, but the devil will be in the details. The leaders of the European Union agreed overnight from Thursday to Friday on a “roadmap” aimed at putting in place, in the coming weeks, measures intended to stem the rise in energy prices. .

The war in Ukraine and the sanctions imposed on Russia have caused a shock to the prices of oil, gas and electricity. But, since February, Europe has reacted slowly, weakened by the divergent interests of member states. If, after tough negotiations, the bloc wanted to present a united front, many points remain to be decided, and the negotiations in the coming weeks promise to be difficult.

“We now have a very good roadmap”, underlined the President of the Commission Ursula von der Leyen, while the President of the European Council Charles Michel spoke of “an agreement on a package of measures” which must now be “dealt with fine way”.

But German Chancellor Olaf Scholz has made it clear that if energy ministers cannot agree on a final version, a new summit of heads of state will be needed.

“Message to the Markets”

According to French President Emmanuel Macron, the mechanisms envisaged could be implemented “at the end of October, beginning of November”. He felt that the leaders had “sent a very clear signal to the markets of (their) determination and (their) unity”.

According to the conclusions released at the end of the meeting, the Heads of State and Government ask the Commission to submit to them “as a matter of urgency” “concrete decisions” on a set of measures, including interventions to tame volatility gas prices.

The Twenty-Seven have agreed to promote joint purchases of gas at EU level, with the idea that they remain “voluntary” but cover at least a “compulsory” target level of 15% of EU stock fill targets for winter 2023.

Avoid “increased consumption” of gas

They also called for “accelerating its negotiations” with “reliable” producer countries such as Norway and the United States, to “take advantage of the aggregate economic weight” of the EU rather than competing on the world market in risks fueling price fever.

In addition to a measure to control the wholesale price in natural gas transactions, the leaders are also asking for a specific plan for a “temporary” mechanism to cap the price of gas used to produce electricity – a device already implemented place in Spain and Portugal, and which France was calling for to be extended to the whole of the EU.

But, in a concession made to Germany, this mechanism will have to be accompanied by safeguards to “avoid any increased consumption of gas”. It will also have to prevent the EU from subsidizing electricity which would ultimately be exported to neighboring countries (Norway, United Kingdom, Switzerland, etc.).

Macron/Scholz, appeasement

Asked about the Franco-German couple, the engine of European cooperation which seems to be broken down, Emmanuel Macron affirmed that his face-to-face meeting with the German Chancellor had made it possible to “clarify many things”.

“It is very clear that Germany has always acted in a very united way,” replied Olaf Scholz. The chancellor had been accused of selfishness after announcing at the end of September a support plan of 200 billion euros for the German economy, not concerted with its partners.

In the middle of the night, after a dozen hours of negotiations between the 27, Emmanuel Macron and Olaf Scholz played the appeasement, the latter evoking in particular an “intense and fruitful” relationship. The two men are to meet on Wednesday in Paris.