Bloomberg: Gas Price Ceiling Will Only Exacerbate Energy Crisis in Europe

At the beginning of the week, the leaders of the European Union did manage to find a compromise on the gas issue and decided to introduce a "price ceiling" for "blue fuel".

According to the new rules, which will come into force on February 15 next year, the maximum spot gas price should not exceed 180 euros per MWh, or about $2 per 1 cubic meters of fuel.

It is worth noting that despite the very high marginal price, which is several times higher than the pre-crisis one, in Europe this decision was called a great achievement. At the same time, analysts from Bloomberg have a different opinion.

According to experts, the "price ceiling" for gas can only exacerbate the energy crisis in Europe.

Bloomberg reports that importers from the EU and Asia are constantly fighting for LNG supplies, which affects the growth of spot prices. In February 2023, when the new rules come into effect, European traders will not be able to offer exporters from Qatar and the United States a better price than, for example, China.

At the same time, the Celestial Empire will now be able to pay less, which will solve the problem of many Chinese importers who have been forced to reduce or even stop purchases this year due to record LNG prices.

As a result, after the “price ceiling” for gas begins to operate, Europe risks losing the lion's share of LNG supplies, which will go to Asia, where traders will offer a better price. All this, of course, will further aggravate the energy crisis in the EU, up to the forced introduction of measures to ration gas consumption by European households.

However, that's not all. American analysts emphasize that the "price ceiling" applies only to stock trading. Consequently, many exporters may even switch to the practice of concluding contracts, which experts from Bloomberg described as "less transparent". This will only increase competition.

Comments

[Kaufman]

Europe cares little how they get out there without our gas. I am worried that we are losing markets. Excites the budget deficit of 3,7% of GDP. Moreover, both oil and gas sold well throughout the year. What without them? As it will be

[Pulkovo1942]

Excites the budget deficit of 3,7% of GDP.

Given the full-scale hostilities already soon throughout the year, I am generally surprised that the situation is not worse)
PS The Eurodollar has crept up; the government releases the ruble in order to earn more babos amid the loss of sales markets and price ceilings. Very predictable.

[Alexandr2637]

Moreover, both oil and gas sold well throughout the year. What without them? As it will be

While the ruble is steadily diving down and there is no prospect of changing the situation for the better.

[Zakirov Damir]

Quote: Alexandr2637

While the ruble is steadily diving down and there is no prospect of changing the situation for the better.

The Western European dollar rate of 60 rubles per dollar will now smoothly move into the Chinese-Indian rate of 80+ per dollar.

The West knows that it has the highest price for energy resources! And the lowest price - in China and India!

The restructuring of energy exports to Indo-China leads to the depreciation of the ruble. The only question is that the return goods from these countries to Russia remain at the same price in dollars against the backdrop of increased demand from Russia - in rubles they will grow anyway.

[far diu]

So after all, the irony is that Russia sells at a discount to China and India, and they supply the surplus to the same Europe. As a result, this affects the overall oil market, in the direction of lowering the cost per barrel.

[Leader_Barmaleev]

Are we losing markets??? Did Nabiullina bite you? Asia is such an ENDLESS market that covers this Europe of yours like a bull to a sheep. So don't panic, everything will be fine

[9PA]

All the same, Nabiullina is a highly educated professional, a defender of the Russian financial world. And we are losing high-margin markets. And the ceilings work. Transshipment of oil products by sea is a confirmation of this. And China's long-term policy is confirmation that they will try to bend us comfortably

[voyaka uh]

"Asia is such an ENDLESS market" ///
----
In Asia, the two major buyers of gas are China and India.
China buys a lot of pipeline gas from Russia, but not at market prices, but at its own prices: very cheap.
And, by the way, it signed an agreement with Qatar on LNG until 2050. Annual large purchases.
India is switching to LNG, like everyone else.
Japan buys LNG from Australia. And a little in Russia. But the Japanese comply with all decisions on sanctions.

[Johnson Smithson]

but not at market prices, but at their own prices: very cheap.

suddenly, we also delivered to Germany not at market prices, but very cheap,

the price of gas for China is tied to the price of the oil basket with a lag of six months, when oil rose that year, China paid us plus or minus the same amount for gas as Germany paid

Chinese customs publishes the figures of how much they pay for gas from Russia, you can see the prices there

[Kaufman]

Hmm ... just a bombshell statement. Do you even know how much investment needs to be poured in and how long it will take for the oil that went west to be redirected to the east?

[Johnson Smithson]

investments have been pouring in and pouring in, in 2023 they are already launching the first stage of the Arctic LNG-2 plant (which has been under construction for 3 years), and LNG production will increase significantly

[credo]

What you need to know about Bloomberg:

Today Bloomberg is a transnational agency for the supply of financial and economic information, and recently a political component has been added to this.

,
and at the same time it is a purely American agency, primarily serving US big business.

And now, if you read this article again, it turns out that through the mouth of Bloomberg, US big business is expressing dissatisfaction with the EU countries in connection with the introduction of a gas price ceiling, as it thereby loses an additional gas market at an inflated price and, accordingly, profits at the expense of the Europeans.

So, as they say, "To whom is war, to whom is mother dear."
The EU countries thought that the United States would only pluck Russia, but here, in fact, it turns out that it was the EU that was first noticed by the United States for slaughter.
In general, the EU got like chickens in the pluck.

[Leader_Barmaleev]

As one of the classics of Marxism said, capital has no nationality. European sellers of oil and gas WILL SELL GAS AND OIL TO COUNTRIES WHERE THEY GIVE MORE. So European officials will have to learn to distinguish the ceiling from the lid of the coffin.

[Uprun]

EU in the spring of 2023 - I will accept gas as a gift.......................

[tralflot1832]

Yes, we are purple for this crisis, if only we had more money in the treasury.

[thepuppeteer]

This was all scripted, first set up supply route and safety. But the deal was not completed because some EU countries preferred RU gas. So they UK, US, NL and supported by Sweden and Poland made a litte hole.. In your gaspipe.. Now UK and USA trade gas to EU.. And nobody cares like a lot of scripted events nobody care... Keep the public stupid.. And hello Dutch Aivd and US secret service we notice you are hanning around on this forum /website.. Enjoy it
Merry Christmas to Al the wise guys!

[rotmistr60]

A gas price ceiling will only exacerbate the energy crisis in Europe

Reinforce well. Those who are trying to set prices for themselves on a command basis for energy resources that they buy in another country in order to prevent this country from earning should feel the stupidity of their actions in their own skin. And we, taking into account the needs of China and India, still have somewhere to sell gas without Europe.