Europe oil and gas prices likely to stay high, EU commissioner Dan Jorgensen says

European oil and gas prices that climbed during the Iran war are unlikely to fall back soon, the European Union’s energy commissioner said Tuesday. Dan Jorgensen said supply remains stable across the 27-member bloc. Still, tighter global gas markets are pushing electricity costs higher. Pressure has also built on diesel and jet fuel availability.

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Jorgensen said the European Commission is preparing steps to protect households and firms from the surge. Prices have risen by about 70 per cent for gas and 60 per cent for oil in Europe. Since the war began, the EU’s bill for imported fossil fuels has increased by 14 billion euros, Jorgensen said.

EU oil and gas prices: warning on a slow return to normal

At a news conference after EU energy ministers met, Jorgensen warned that any peace deal would not quickly ease costs. "What I find extremely important is to state as clearly as I can, that even if that peace is here tomorrow, still we will not go back to normal in a foreseeable future,\" Jorgensen told a news conference after a meeting of EU energy ministers.

Jorgensen said joint EU action is needed to prevent mixed national steps. Such moves could confuse markets and worsen price swings. \"Closely coordinated action between all EU members is necessary to avoid fragmented national responses and disruptive signals to the markets,\" he said.

EU oil and gas prices: measures for electricity bills and industry

Jorgensen said a policy \"toolbox\" will be presented soon. It will include options for countries to separate gas prices from electricity prices. The Commission is also weighing an electricity tax cut. This idea was suggested by Commission President Ursula von der Leyen, Jorgensen said.

Jorgensen said a repeat of the 2022 gas crisis is not expected. That crisis saw firms gain large profits during steep price jumps. Still, Jorgensen said a one-off windfall tax remains possible. Support for vulnerable groups and stressed industries could also be expanded and simplified.

EU oil and gas prices: demand cuts and the IEA 10-point plan

Jorgensen urged members to consider the International Energy Agency’s 10-point plan. The steps include working from home and lowering highway speeds. The plan also supports greater use of public transport. It further encourages more car sharing to reduce fuel demand.

EU oil and gas prices: Russian gas ban and alternative suppliers

Jorgensen said the EU will keep its ban on buying Russian gas. The aim is to cut dependence and reduce funding for Russia’s war in Ukraine. Reliance on Russian gas fell from 45 per cent before the war to 10 per cent now. Jorgensen said it will reach zero after other supplies rise, mainly from the US.

Jorgensen said the EU is also assessing supplies from Azerbaijan, Algeria and Canada. Smaller producers worldwide are part of the search, Jorgensen added. Jorgensen warned the EU should not repeat earlier errors, when energy was used as leverage. Jorgensen said it would be \"totally unacceptable\" to keep buying energy that could help fund Russia’s war in Ukraine.

With inputs from PTI