A European move to combat speculation and reduce gas prices by adjusting the storage rules

9 hours ago

2 minutes read

Brussels on April 24 / WAM / The European Parliament adopted a legislative draft aimed at achieving the stability of the gas market and reducing prices, by introducing greater flexibility on gas storage rules in the European Union countries.

The draft seeks to combat potential speculation and promote supply security.

The Industry, Research and Energy Committee in Parliament supported the commission’s proposal to extend the work of the current gas storage regulations until December 31, 2027.

This regulation was adopted in 2022 in response to the energy crisis, and it was scheduled to end in 2025, as it was designed to ensure the security of gas supplies before the winter seasons.

This legislative proposal for European Parliament members provided the opportunity to make many amendments to the current rules, with the aim of alleviating the tensions witnessed by the gas market, which partially resulted from the market expectations of the mandatory goal of filling the storage capacity to 90 % by November 1 of each year.

To this end, European Parliament members suggest reducing the goal of filling from 90 % to 83 % for better reconciliation between energy security and market logic and reducing gas prices, and member states will be able to deviate from this fulfillment goal of up to four percentage points in the event of harmful conditions in the market, such as breakdown or high demand, and the commission can allow an additional deduction of four points if these market conditions continue.

However, the members of the European Parliament stressed the need for member states to be committed to ensuring that the cumulative application of the terms of flexibility and exceptions does not lead to reducing the total inventory obligations to less than 75%.

The draft report, which was formulated by the Chairman of the Industry, Research and Energy Committee, Boris Bodka (from the European People’s Party, Poland), was adopted by a large majority of 64 votes compared to 10 votes with 12 members abstaining from voting, and the text is scheduled to be presented for the final vote during the next plenary session of the European Parliament, which will be held from 5 to 8 May.

Energy security in the European Union has always been a great concern in recent years, and this is greatly due to its dependence on countries outside the Union in providing primary energy sources.