The price cap, according to Chancellor Nadhim Zahawi, will restrain Russia’s military machine while also reversing the global energy price spiral.
Russia has abandoned plans to reconnect a major natural gas pipeline to Europe.
The decision by Gazprom, a state-owned company, will make it more challenging for Europe to acquire fuel before the winter.
Gazprom stated that the Nord Stream 1 pipeline would remain closed due to a leak in the primary gas turbine, although Siemens Energy, which typically maintains the turbines, stated that such a leak should not impede operation.
Europe and the National Security Council of the United States have both accused Russia of using natural gas as a “weapon against consumers.”
Earlier, though, European Council President Charles Michel declared, “The use of gas as a weapon will not alter the EU’s commitment.”
Since August of last year, wholesale gas prices have increased 400%, causing agony for homes and businesses in Europe, which has long relied on Russian energy.
Also on Friday, G7 finance ministers decided to cap the price of Russian oil exports to make it more difficult for Vladimir Putin to finance his invasion of Ukraine.
Despite exporting less oil since the start of the war, Russia earned £600 million more from oil sales in June than it did in May due to soaring prices caused by the conflict.
The British Chancellor, Nadhim Zahawi, stated that the price cap would also bring about global price stability, which would “shield our citizens from oil price shocks next year.”
He said, “This will prevent Putin from profiting from unduly high oil prices and safeguard us all from oil price shocks in the coming year and beyond.
Ukrainian President Volodymyr Zelenskyy, who has consistently advocated for tougher sanctions against Russia, stated that the move “will not only limit the flow of petrodollars and gas euros to Moscow but will also restore justice for all Europeans, whom Russia is attempting to blackmail with artificially inflated energy market prices.”
Former Russian president Dmitry Medvedev stated on Telegram that Moscow will respond by cutting off all supply to Europe, stating, “There will be no Russian gas in Europe at all.”
Germany, one of the countries most dependent on Russian energy, has been prepared for a gas supply drop, and its network regulator has cautioned citizens and businesses to reduce use.
