MOSCOW, Sep 2 — PRIME. Europe understands that it will not be able to compensate for the shortage of Russian gas supplies without serious losses, and now the entire continent is afraid of the arrival of winter, writes Asharq Al-Awsat columnist Ragida Dergam.
She noted that although Europe has only recently experienced a heat wave, a new threat is already looming on the horizon. Gas and electricity prices have skyrocketed in many European countries, and now everyone fears the arrival of winter.
In Germany, Olaf Scholz said that thanks to the government’s measures to ensure energy supplies during the winter, his country is ready for a new reduction in Russian gas imports. He emphatically expresses his confidence that the country manages even better than originally predicted to prepare for the cold season in terms of energy supplies.
But, as columnist Asharq Al-Awsat points out, Berlin is too dependent on Russian gas, especially for heating homes and running businesses. And the authorities do not seem to know how to save the situation so that companies and factories do not close. Germany also plans to introduce a new surcharge on gas, allowing energy companies to pass the burden on to consumers. But such a decision is very unpopular among the population of the country and causes a lot of protests, since it actually cancels the benefits provided to the population in the past. Due to pressure and concerns about the continuation of the rallies, Berlin vowed to reconsider its decision and also pledged to approve another aid package soon.
France, which relies heavily on nuclear power, is also facing relatively high energy prices. This is mainly due to the closure of half of the industry’s facilities for maintenance purposes. Some enterprises will suspend work for two whole months, that is, even after the start of the winter season. This will limit the country’s ability to produce energy. All these problems have led to the fact that from a country exporting electricity, France has become its importer.
In addition, the French authorities lowered the price ceiling for energy supply companies by 4%, and in fact it turns out that companies suffer losses caused by high prices in the international market, without shifting the entire amount to consumers. But these measures expire at the end of the year. Within two weeks, the government will have to decide whether it will extend the duration of these measures or not, although it has been stated that there is no authority for such an extension.
“In other words, the French may face significant price increases early next year,” Dergham said.
The UK, which is not part of the European Union, suffers the most from high energy prices on the world market, although it does not import gas from Russia. Earlier, the British energy authority announced its intention to allow companies to raise prices by 80% from the beginning of October. Under this decision, average annual heating and electricity bills will increase from £1,917 to £3,549. Many organizations warn that the number of “energy poor households” in the country will double, referring to the growing number of residents who will not be able to heat their homes due to high prices.
Although the British government had previously announced an aid package to ease the burden on the population, this was not enough. The authorities review the price ceiling every three months, which means that at the beginning of next year they can rise again and reach record levels.
“By raising them, the government is trying to avoid the bankruptcy of energy companies, especially since a large number of them have closed in recent months. Thus, energy prices began to rise even before the special operation in Ukraine due to increased transport costs after the UK left the European Union, as well as increased demand at the end of the pandemic,” the journalist explained.
Although Madrid imports a small amount of Russian gas, in general it also suffers from high energy prices on the world market.
At the moment, the Spanish authorities are taking measures to reduce energy use, similar to those previously announced by the German government. In particular, even before the arrival of winter, the authorities decided to use air conditioners with a temperature of at least 27 degrees Celsius, providing them without fail to public institutions, shops, offices and theaters, with the exception of private homes. It was also decided to keep temperatures below 19 degrees Celsius in winter to heat offices, shops and public facilities. In addition, there is a call to turn off the lights at night and refuse to illuminate public buildings.
Stock prices for gas in Europe have been growing since the spring of last year and continue to update their historical highs. The price record of $3,892 per thousand cubic meters was reached on March 7. Gas quotes a day earlier for the first time since the beginning of spring crossed the threshold of $3,500, but then dropped again – to the level of $2,500. This is several times higher than last year’s prices, when gas prices were already at a record high.
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