EU pins soaring gas prices on geopolitics

Tensions between nations have helped send European energy bills to a historic high

The price of energy across the world has skyrocketed to unprecedented levels in a trend that is being exacerbated by geopolitical pressures, says the European Commission.

The soaring cost of gas has clearly impacted energy prices on the continent, according to European Commissioner for Energy Kadri Simson.

However, strife between and within nations has inevitably had a knock-on effect too.

February futures prices at the Netherlands’ Title Transfer Facility, a virtual trading point for natural gas, reportedly surged to $915 per 1,000 cubic meters on Friday, or €78 ($88.5) per megawatt hour in household terms.

In December, they hit a record high in Europe of nearly $2,200 per 1,000 cubic meters, which constituted an almost 400% rise since the start of the year.

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“This is a particularly important time for the energy sector, both for its current state and for its future,” Simson said after a meeting with European energy ministers in France on Saturday.

“In the short term, we are faced with unusually high energy commodity prices – a trend intensified by geopolitical tensions.”

She affirmed that the current astronomically high prices for electricity and gas were placing an intolerable burden on homeowners and businesses alike across the European Union, but said national leaders were taking all possible steps to cushion them from future market shocks.

“These actions taken by member states to protect the consumers amount to more than €21 billion – a remarkable and swift effort by the EU governments,” Simson said.

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