Gas exchange may leave EU over price cap – media
A major natural gas trading platform may have to leave the European Union if Brussels adopts a plan to cap prices, the Intercontinental Exchange (ICE), which operates the Dutch Title Transfer Facility (TTF) hub, said in a statement seen by Reuters.
On Thursday, the EU Council announced that the bloc’s energy ministers had failed to reach an agreement on a proposed gas price limit following months of negotiations. Some member states want to lower the ceiling, while others are worried that the move would further destabilise energy prices and drive up inflation, wreaking havoc on markets.
“If agreed, the market correction mechanism will be imposed on customers and the market infrastructure with no time for resilient testing and thorough risk management,” the ICE said.
Set up in 2003, the TTF is the most liquid gas futures market in the region, with a wide range of gas suppliers, wholesalers and speculators trading on a daily basis.
“It is the responsibility of ICE as the market operator to consider all options if this mechanism is agreed, up to and including whether an effective market in the Netherlands is still viable,” the operator added.
Under the original plan put forward by the European Commission, the gas price cap would be triggered when prices on the TTF exchange, Europe’s gas benchmark, reach €275 ($292) per megawatt hour and are €58 higher than the LNG reference price for two weeks. The proposal was met with criticism, with some member states warning of market volatility, while others argued that the level was too high to be effective.
Earlier this month, the European Commission reportedly proposed lowering the cap to €220 and slashing the timeframe to five days, while also reducing the difference with global LNG prices to €35. However, 12 countries reportedly said the price would still be too high, and demanded a ceiling of €160 with a €20 spread.
For more stories on economy & finance visit RT's business section
