European gas prices rose to record levels on Wednesday. The price went up 60% in two days due to continued strong demand, limited supply on the gas market and the expectation of colder weather in the northern hemisphere. The European Commission is concerned, but says that there are enough gas reserves in Europe to survive the winter.

On Wednesday, the price of a so-called megawatt-hour gas rose by 40 percent to more than 160 euros. Tuesday, the price went up by 20 percent. The price has now fallen again to about 131 euros.

Due to the high demand for gas due to the economic recovery of the COVID crisis, cold spring, and is less produced energy comes from renewable sources, run energy, and the gas is smaller. In addition, the supply of Russian gas is limited and it is difficult to find gas elsewhere, as there is also strong demand from Asia with thus fierce competition.

Energy Commissioner Kadri Simson said on Wednesday that the shock of high gas prices should not be underestimated. In her view, poorer households are particularly affected by rising energy costs. She said the prices will remain high for the time being, but there will be enough gas for the winter. She believes that EU member states should look at ways to help poorer households with the high costs, for example by reducing energy taxes or providing subsidies.

Several countries, such as France and Spain, believe that the European Union should take action to cope with the rise in prices. Spain has proposed a joint EU procurement of natural gas and the establishment of a strategic gas supply. Simson said that Brussels will come up with plans for a review of the rules in the European gas market before the end of this year.

More and more companies in Europe are struggling with high gas prices and therefore have to reduce or even temporarily stop production because they would otherwise be loss-making. High prices are also driving inflation, undermining consumer purchasing power.

Households also face higher energy bills, resulting in less money remaining for other expenditure. France has already taken measures to help poorer families, for example through subsidies and freezing the energy bill.

Pricewise reported on Wednesday that an average household pays 500 euros more than last week for a one-year energy contract. For a three-year contract, that’s 250 euros. According to Pricewise, energy suppliers are also forced to withdraw because of rising purchase prices or withdraw because they run too much risk.

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