EU Agrees to Loosen Gas Storage Rules

EU agrees to loosen gas storage rules

BRUSSELS (Reuters) -The European Union's member states have reached an agreement with the EU Parliament to loosen the EU's rules on filling gas storage, following concerns that earlier rules on this risked inflating energy prices.

The agreement was announced by the European Commission on Tuesday.

The EU's gas storage rules were introduced in 2022 to ensure EU countries had a buffer of stored fuel during winter, after Russia cut gas deliveries following its full-scale invasion of Ukraine, sending Europe's gas prices soaring.

But governments backed plans in April to soften the rules before winter, over concerns the requirement to fill storage to 90% capacity by November 1 inflates prices, by telling the market European buyers needed to buy large amounts of gas ahead of this deadline.

The deal allows the EU's member states to achieve this 90% filling target at any point in time between October 1 and December 1, taking into account the start of the member states withdrawal period. Once the 90% target is met, it should not be required to maintain that level until 1 December.

The EU's member states should also have the possibility to deviate by up to ten percentage points from the filling target in case of difficult market conditions, such as indications of speculation hindering cost-effective storage filling.

"The European Union needs stable energy supplies at affordable prices to prosper. Gas storage is a key contributor to our security of supply and market stability. It also protects us from Russia's energy weaponisation and market manipulation," said EU energy commissioner Dan Jorgensen.

"In the current geopolitical context, this agreement shows that the EU remains determined to shield its citizens and businesses from any risk of supply disruption and price spikes," he added.

(Reporting by Kate Abnett;Editing by Sudip Kar-Gupta)