OSLO, March 12 (Reuters) - Norway's Prime Minister Jonas Gahr Stoere said on Thursday that it would be unwise for Europe to cap the price of natural gas, which has risen some 60% in the wake of the
Europe should not cap gas prices, Norway's prime minister says
Norway's Position on European Gas Price Caps
Rising Gas Prices Amid Middle East Conflict
OSLO, March 12 (Reuters) - Europe should refrain from capping the market price of natural gas even if costs are soaring due to the war in the Middle East, the prime minister of major supplier Norway said on Thursday.
The continent's benchmark front-month TTF gas contract has risen some 60% following the outbreak of the U.S.-Israeli war on Iran and Tehran's attacks on ships in the Strait of Hormuz.
European Union's Consideration of Price Caps
The European Union is considering measures to curb energy prices, including by setting a cap on gas prices, European Commission President Ursula von der Leyen said on Wednesday.
Potential Consequences of Price Caps
But while capping the price could be tempting, it would only lead to bigger problems by raising demand at a time of shrinking supply, Norway's Prime Minister Jonas Gahr Stoere said.
"It doesn't solve the challenge we are facing," Stoere told an energy conference in Oslo.
Norway's Commitment as a Gas Supplier
Norway, Europe's biggest supplier of natural gas, will remain a reliable provider of energy to the continent, he said.
Historical Context and Ongoing Arguments
Previous Gas Price Surges
Europe refrained from triggering gas price caps during a surge in prices following Russia's 2022 full-scale invasion of Ukraine, and Norway will continue to argue against such a cap, Stoere said.
EU Proposals for Industry Relief
Impact on European Industry
Even before oil and gas prices rose, Brussels had been drafting proposals to provide relief to industries that say high energy prices mean they cannot compete with rivals in China and the United States.
(Reporting by Nora Buli; Editing by Terje Solsvik and Joe Bavier)
