The European Union Underlies Gas Price Limits, Russia's Loss Of Market Mechanism Violations

Illustration of the Russian gas facility. (Wikimedia Commons/Yellowis

JAKARTA - Western efforts to impose an upper limit on gas prices are considered by Kremlin spokesman Dmitry Peskov to violate market mechanisms.

"This is a violation of the market pricing process, an addition to the market process. Any reference to the 'boundary' is unacceptable," a Kremlin spokesman said.

"Russia needs time to consider pros and cons, as well as choose a response to new gas sanctions," Peskov noted.

"Of course, time will be needed to thoroughly weigh all the advantages and disadvantages while looking for a solution. You know the oil process is a bit protracted. However, (Mcow's response to oil price limits) will be published. That will be the same as gas," Peskov said.

"Of course," he added in response to the question of whether such sanctions could be deemed unacceptable.

As previously reported, EU countries agreed on an upper limit on the price of dynamic gas of 180 euros per MWh.

The restrictions are the European Union's latest attempt from 27 countries to lower gas prices, which have pushed for higher energy bills and pushed for record high inflation this year, after Russia halted most of its gas shipments to Europe.

"We have managed to find an important deal that will protect citizens from skyrocketing energy prices," said Jozef Sikela, Czech Republic's Minister of Industry, who holds the post of president of the European Union.

It is known that the surge in electricity and gas prices has rocked energy companies across Europe, forcing utility and merchants to secure additional funds from governments and banks to meet margin call requirements.

The contract hit a record high of 343 euros in August, a price spike that prompted the European Union to move forward with a price limit.

Although agreed, Hungary is said to oppose price limits, while the Netherlands and Austria chose abstain. Both have rejected the limit during negotiations, fearing it could disrupt Europe's energy market and jeopardize European energy security.