EU makes no mention of gas price cap in latest Russian sanctions package

The EU has agreed an eighth package of sanctions against Russia over its invasion of Ukraine, the European Commission and the European Council announced on October 6, setting out a legal framework to implement an oil price cap proposed by the G7 nations, among other measures. However, the package does not cover a proposed cap on Russian gas prices.

The latest package introduces EU import bans worth €7bn ($6.9bn), aimed at curbing Russia's revenues, depriving Moscow's military of key components, technologies and supplies. It also "lays the basis for the required legal framework to implement the oil price cap envisaged by the G7," the commission said.

Member states have been at odds over how a gas price cap should be implemented, and the fact that many members including France and Italy want to see it applied to gas from all suppliers and not only Russia, may mean it will be introduced outside the Russian sanctions. Others including Germany want governments to set a gas price and then cover the difference to the actual market import price. This would mean governments subsidising supplies, but could avoid suppliers diverting deliveries to markets where prices are higher.

European Commission president Ursula von der Leyen said on October 5 that the EU executive had begun working on a "temporary" measure to cap gas prices across the bloc. EU leaders are due to discuss it in a meeting on October 7.