‘Crunch time’: EU members in last-minute push to compromise on gas price cap
A worker walks past gas pipes that connect a Floating Storage and Regasification Unit ship with the main land in Wilhelmshaven, northern Germany on December 17, 2022. EU energy ministers are wrangling over a proposed price cap on gas.
Michael Sohn | Afp | Getty Images
European Union nations are engaged in crunch talks to cap gas prices morning, with energy ministers Monday seeming optimistic about a deal following two months of tough negotiations.
“There will be difficult discussions, but I am confident in our ability to reach a collective agreement,” French Energy Minister Agnes Pannier Runacher said.
A draft text seen by Reuters would see a cap triggered if front-month contract prices on the Dutch TTF, Europe’s main benchmark for natural gas prices, exceed 188 euros ($200) per megawatt hour for three days.
Runacher said France would be “comfortable” with a range of “160 to 200 euros [eur/MWh], and we feel that this price [range] converges with that of the presidency.”
On Monday morning, ministers referred to the measure as a “gas market correction mechanism” rather than a cap. Belgian Energy Minister Tinne van der Straeten said the draft text refers to the proposal under this name.
The move is intended to shield consumers from the sharply higher prices that have hit the bloc following Russia’s invasion of Ukraine. European natural gas prices reached historic levels of around 350 euros per megawatt hour in August, when traders were concerned about the bloc’s unity in fighting the energy crisis.
Opinion has been divided on how high the cap should be, and whether the market intervention is a risk to financial stability in the euro area. On Dec. 5, the EU implemented a full ban on Russian seaborne crude oil imports to the region and will follow up with similar measures targeting Moscow’s other oil products in early February.
Germany, the Netherlands and Austria have warned that the gas price cap could divert supplies away from the EU and called for conditions such as an automatic suspension of the cap in certain circumstances.
Germany’s position
The European Central Bank warned earlier this month that capping natural gas prices could create instability in financial markets.
“The more safeguards, the more safety nets there are, the more tolerant we can all be with the number, but it would be irresponsible to just set a number and say this is strict and we don’t do anything else,” German Economy Minister Robert Habeck said.
The central bank is not the only institution warning about the potential market ramifications of a price limit. Market operator ICE (Intercontinental Exchange) — the operator of a key natural-gas market in Europe — has threatened to remove trading from the bloc if the EU goes ahead with the measure, according to the Wall Street Journal.
“Germany has asked for strong safeguards with regards to security of supply, but also stability on both the energy and financial markets. These are concerns that we all share. It’s not a concern of Germany alone, it’s a concern of all 27 of us,” said Belgium’s van der Straeten.
“This crisis is not over, there is [the] next storage season coming,” she added.
Compromise within reach?
Miriam Dalli, Malta’s energy minister, said it was “crunch time for reaching a compromise” that makes sense for all member states and can “calm the markets” while ensuring security of gas supply.
She said talks had progressed a long way from the European Commission’s original proposal of a 275 euros per megawatt hour cap, which several member states argued was too high and unlikely to be triggered.
The Dutch TTF traded around 108.8 eur/MWh at 10:00 a.m. Monday CET, its lowest level since Nov. 11.
Greek Energy Minister Konstantinos Skrekas said countries had a “clear mandate from our leaders to come out with a solution to the cap today.”
“We wouldn’t be so insistent if we were not convinced that this is the best solution for European citizens,” he said, adding that any cap between 150 and 200 eur/MWh would be effective. Asked about the suitability of a price ceiling at 188 eur/MWh, he said such a level would “give the right signals to the market.”
Estonian Finance Minister Riina Sikkut also said she was “positive” a compromise could be reached but added that it was difficult to say exactly what it would be. She expressed confidence that “good news” would emerge by Monday evening.
Jozef Sikela, industry minister of the Czech Republic, and Kadri Simson, European commissioner for energy, are due to deliver a press conference at 5:30 p.m. CET.
CNBC’s Ruxandra Iordache and Hannah Ward-Glenton contributed to this story.
Environment
Tesla hires celebrity ambassador despite Elon Musk saying they don’t pay for endorsements
Tesla has hired a celebrity ambassador, a departure from Elon Musk’s policy of not paying for celebrity endorsements.
Musk has often bragged about the fact that Tesla doesn’t pay for celebrity endorsements in contrast to other automakers who hire celebrity brand ambassadors to promote their cars.
Much like advertising, Musk seems to be abandoning this strategy.
Tesla announced that it hired Olympic shooter Kim Ye-ji, whose performance at the Paris Olympics this summer went viral, to be the automaker’s brand ambassador in Korea.
Kim said about her new partnership with Tesla:
I’m very excited to work with Tesla, who have recognized me. I hope to convey a positive message together with Tesla.”
Here are a few pictures released to announce her new partnership with Tesla:
Kim’s agency said that her relationship with Tesla started from CEO Elon Musk tweeting about her viral performance at the Olympics:
“The relationship between Kim Ye-ji and Tesla developed after Elon Musk mentioned her. The company said that Kim is Tesla Korea’s first brand ambassador.”
She is not only Tesla Korea’s first ambassador, but she is the first known paid celebrity ambassador for Tesla globally.
The policy change is not entirely surprising since the policy of Musk not paying celebrities to endorse Tesla’s products was often attached to the automaker’s strategy not to advertise.
Musk went as far as to say that he “hates advertising,” and Tesla started advertising last year.
The change in strategy coincidently, or not, came after Musk bought Twitter, a company relying on advertising, and Tesla even started to advertise on Twitter, now called X.
Tesla sales in Korea haven’t been amazing, but the country’s auto market greatly favors domestic brands. The American automaker does fairly well for a foreign brand with the Model Y becoming the best-selling imported vehicle in Korea during the first half of 2024.
Although, it amounted to just over 10,000 units.
Electrek’s Take
It’s a change of strategy, and Elon certainly can’t claim that Tesla doesn’t pay for celebrities to endorse its products, but it is probably a smart move due to the fact that Koreans prefer domestic brands.
Kim could help create a deeper level of attachment to the Tesla brand, but I don’t really know. I’m just speculating.
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Kia just broke its October sales record as its impressive US sales run continues. After another record-breaking month, Kia said the growth is fueled by “strong demand” for its electric vehicles.
Kia sets new October sales record in the US
Kia sold 69,908 vehicles in the US last month, up 16% from its previous October sales record in 2023.
According to Kia, higher demand for its electric models is charging up sales in the US. Kia’s electrified sales (EVs, PHEVs, and HEVs) reached its highest ever in October.
All-electric vehicles (EVs) led the way, with sales surging 70% year-over-year (YOY). Plug-in hybrid (PHEV) and hybrid (HEV) sales were up 65% and 49%, respectively, from October 2023.
Kia’s first dedicated electric model, the EV6, set a new October sales record with 1,941 units sold. Through the first ten months of 2024, Kia has now sold over 17,700 EV6 models in the US. Meanwhile, its first three-row electric SUV, the EV9, continues to defy expectations.
With another 1,941 models sold last month, Kia EV9 sales reached 17,911 through October. That’s even more than the EV6 despite costing +$12,000 more.
Kia’s first US-made EV9 rolled out of its West Point, GA plant this summer. Although the EV9 is expected to qualify for the full $7,500 federal tax credit next year, Kia is matching it for now through incentives.
Next year, we will also finally see the EV9 GT, which Kia promises will have “enormous power.” Ahead of its official debut, we got our first look at the sporty electric SUV with an active spoiler last month.
| 2025 Kia EV9 Trim | Starting Price* |
| Light Standard Range | $54,900 |
| Light Long Range | $59,900 |
| Wind | $63,900 |
| Land | $69,900 |
| GT-Line | $73,900 |
Earlier this month, we learned that the 2025 EV9 will start at $54,900 (not including the destination fee), which is only $700 more than the 2024 model.
With prices dropping to potentially under $50,000, Kia’s three-row electric SUV is a steal. If you’re ready to experience the EV9 for yourself, we can help you get started. You can use our links below to view deals on Kia’s electric vehicles in your area.
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The outcome of the U.S. presidential election on Nov. 5 won’t affect oil production levels in the short- to medium term, Exxon CEO Darren Woods told CNBC on Friday.
Former President Donald Trump has called for unconstrained oil and gas production to lower energy prices and fight inflation, boiling his energy policy down to three words on the campaign trail: “Drill, baby, drill.”
“I’m not sure how drill, baby, drill translates into policy,” Woods told CNBC’s “Squawk Box” Friday after the largest U.S. oil and gas company reported third-quarter results.
Woods said U.S. shale production does not face constraints from “external restrictions.” The U.S. has produced record amounts of oil and gas during the Biden administration.
Over the past six years, the U.S. has produced more crude oil than any other nation in history, including Saudi Arabia and Russia, according to the Energy Information Administration.
Output in the U.S. is driven by the oil and gas industry deploying technology and investment to generate shareholder returns based on the break-even cost of production, the CEO said.
“Certainly we wouldn’t see a change based on a political change but more on an economic environment,” Woods said. “I don’t think there’s anybody out there that’s developing a business strategy to respond to a political agenda,” he said.
While shale production has not faced constraints on developing new acreage, there are resources in areas like the Gulf of Mexico that have not opened up due to federal permitting, the CEO said.
“That could, for the longer term, open up potential sources of supply,” Wood said. In the short- to medium term, however, unconventional shale resources are available and it’s just a matter of developing them based on market dynamics, he said.
Exxon Mobil shares in 2024.
The vast majority of shale resources in the U.S. are on private land and regulated at the state level, according to an August note from Morgan Stanley. About 25% of oil and 10% of natural gas is produced on federal land and waters subject to permitting, according to Morgan Stanley.
Vice President Kamala Harris opposed fracking during her bid for the 2020 Democratic presidential nomination. She has since reversed that position in an effort to shore up support in the crucial swing state of Pennsylvania, where the natural gas industry is important for the state’s economy.
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