Europe
Price cap on Russian gas creates trouble in Europe
Spanish Energy Minister Teresa Ribera lashed at Brussels last week. Describing the European Union’s (EU) price cap plan for natural gas as “ridiculous” and “damaging”, Ribera also urged Brussels bureaucrats to take the issue seriously.
Polish Climate Minister Anna Moskwa has also joined the long list of people who are unsatisfied with the matter. “[The gas cap proposal] is a joke,” he said, saying the EU’s offer for a price cap does not satisfy a single country.
EU officials, reluctant to give their names to CNBC, said the price cap negotiations had been challenging. Another official told that the negotiations were heated and at some point things even got “really ugly”.
No one is satisfied
The European Commission’s proposed natural gas price cap is 275 euros per hour and the price of natural gas will have to remain above 275 euros for two weeks for the law to be implemented. According to European Energy Commissioner Kadri Simson, the price cap is not a silver bullet that will lower energy prices, but a powerful tool that can be used when needed.
While EU energy ministers had not yet met and the Commission’s proposal had just emerged, a division had begun, involving France and Italy on one side, and Germany and the Netherlands on the other. The group, led by France and Italy, argued that it was necessary to set a price cap on wholesale gas prices in order to protect consumers and industry. The group led by Germany and the Netherlands thought that this would jeopardize supplies. This group includes Austria, Denmark and Hungary.
Similar objections came from members of the European Commission. Setting a price cap for natural gas would cause supplies to shift outside of Europe, causing fuel shortages and making it difficult to supply gas to countries in need within the union.
The electricity commodity exchange Europex also issued a statement, saying they were deeply concerned about the “market adjustment mechanism”, with the risk that the price cap would drive buyers to buy and sell directly. What is meant by direct trading is the purchases made through brokers and companies that are not listed on the stock exchange.
Objection by Poland, Spain and Greece
Countries that support the price cap think the bill is unrealistic. For example, the Spanish’s own Iberian price cap mechanism, which will expire in 2023, has set 40 euros as the limit. Therefore, it makes little sense for Spain to adjust to the price cap of 275 euros.
Poland’s problem seems to be different. Together with the Baltic countries, Warsaw argues that the price cap for natural gas and oil is too high, that it will never be put into practice and therefore will not harm Russia. For example, a price cap in 65-70 dollars range is being considered for Russian oil, but Poland’s proposal is 30 dollars.
Greek Environment and Energy Minister Costas Skrekas says a price cap of 275 euros is not actually a price cap though. The energy crisis for businesses and households is “shocking”, Skrekas said, claiming that Athens’ price cap proposal is 150-200 euros.
The meeting failed to reach any consensus
The emergency meeting of EU energy ministers last week also resulted with uncertainty and disagreement. “The debate was very heated and you all know that there are very different views,” Czech Industry Minister Jozef Síkela, who chaired the meeting, told the press.
Dutch Energy Minister Rob Jetten, who was skeptical about the price cap, said there were still huge. On Friday, while the price of gas in Europe was 123 euros per megawatt hour, Jetten said they want to prepare for the following year.
The Associated Press estimates that there are 15 countries that want a lower price cap. Germany and the Netherlands worry that gas suppliers who find better prices elsewhere in the world will bypass Europe.
With no results from last week’s meeting, a new meeting was scheduled for December 13th. On 5 December, new EU oil sanctions against Russia will begin.
Russia’s reaction
The first statement from the opposite front came from Mikhail Ulyanov, Russia’s permanent representative in Vienna-based international organisations. “Totalitarianism is being expanded into economics by the West,” Ulyanov said, arguing that the West is the biggest enemy of the market economy. Ulyanov also reminded that Moscow will not sell oil and natural gas under the price cap conditions.
In a phone conversation with the Iraqi Prime Minister, Russian President Vladimir Putin warned that the price cap that is to be implemented on Russian oil and natural gas would create “serious consequences” in the global energy market.
Estimates show that oil production in Russia ranges from 20 to 50 dollars per barrel. According to Bloomberg, that’s an average of 52 dollars. If the EU implements the price cap, Russia has the opportunity to cut production and turn the world’s energy markets upside down.
Attitude of US is different from EU
Other EU member states, including those with large maritime industries such as Greece, Malta and Cyprus, want to keep the price high in order to maintain the flow of Russian oil trade, the Financial Times wrote. The interesting thing is that the US probably supports this position. Washington is concerned that EU sanctions and the price cap will drive oil prices up.
The Biden government hopes that if a price cap is set, countries such as China, India and Turkey will be able to negotiate lower-priced deals, taking advantage of the price cap.
Europe
Outgoing UK PM Starmer to boost defense spending by £1 billion to secure legacy
Outgoing British Prime Minister Keir Starmer is pledging to secure at least £1 billion in additional funding for the defense sector, according to people familiar with the matter.
The move is being viewed as an effort by Starmer to cement his political legacy in the prime minister’s office before stepping down, the Financial Times reported.
Sources said Starmer aims to publicly present the defense sector investment plan on Tuesday, June 30, following multiple prior delays to its publication.
Under the plan, the total funding volume for the armed forces over the next four years is expected to rise approximately £14.5 billion to £15 billion above previously projected levels.
The Starmer-led government had previously proposed providing £13.5 billion in additional resources for defense needs.
However, former Defence Secretary John Healey opposed the prime minister’s proposal, viewing the amount as insufficient, and subsequently resigned from his post in June.
Healey had insisted on an £18 billion increase in the defense budget. In his resignation statement, the outgoing secretary called on the head of government to commit to raising military spending to 3% of gross domestic product by 2030.
Healey noted that the prime minister’s existing plan would only maintain this ratio at 2.68%.
Following these developments, newly appointed Defence Secretary Dan Jarvis reshaped the budget plan and made several difficult decisions, according to sources.
The new program drafted by Jarvis reportedly places a higher priority on the combat readiness of the military and the deployment of autonomous technologies—including unmanned ground vehicles—across all military units compared to the proposals put forward by the departed Healey.
A government official indicated that in the event of potential last-minute disruptions, the ultimate deadline for the announcement would be July 6, immediately ahead of the NATO summit to be held in Ankara.
The Financial Times pointed to the obligation to demonstrate to allied countries, most notably US President Donald Trump, that the United Kingdom is making serious investments in defense as a key source of pressure on Starmer.
According to assertions in the report, Starmer could hand over prime ministerial authority to Andy Burnham, who is seen as his strongest successor, as early as July 20.
Sources familiar with the process noted that Burnham has already begun receiving briefings on government operations.
Furthermore, sources stated that Burnham has privately agreed with arguments that the spending plan should be approved before the NATO summit rather than being delayed.
Conversely, one source did not rule out the possibility that the incoming prime minister could face more intense pressure, which could lead to a reassessment of defense funding.
Commenting on the position of the military leadership, the source remarked: “The military wing has adopted an attitude of ‘it is better than nothing,’ but we will have to renegotiate this issue with the new Prime Minister, Andy Burnham, in any case.”
Keir Starmer announced in June that he would resign following pressure from within his own party.
Starmer has led the British government for approximately two years.
Europe
Europe faces 15-year low in winter gas reserves as June storage targets fall short
European Union member states risk entering the upcoming heating season with their lowest natural gas reserves in 15 years, according to industry assessments.
A report by consultancy firm Wood Mackenzie, published by the Financial Times, warns that if current trends persist, energy markets could face a new wave of price spikes ahead of the winter period.
Analysts project that European underground gas storage facilities may reach a fullness level of only 76% by the end of the injection season, which typically runs from April to October.
After a harsh winter left storage facilities at a mere 28% capacity at the start of the season, EU nations are struggling to rebuild their reserves to historical norms.
According to data from Gas Infrastructure Europe (GIE), the current average storage fullness level stands at 48.29%.
June, traditionally the highest-volume month for filling underground storage facilities in the European energy sector, failed to deliver the targeted efficiency this year. Industry officials note that above-normal temperatures expected in July and August will drive up electricity consumption for cooling, making it even more difficult to direct gas into storage.
Having severely depleted its reserves during the past two harsh winters, Europe must store approximately 70 billion cubic meters of natural gas to prepare for the upcoming winter.
However, the storage injection rate failed to accelerate in June, falling 14.7 percentage points behind the five-year average. In the final week of June alone, this deficit widened by an additional 0.2 percentage points.
Renewable energy sources are also proving insufficient to bridge the supply gap. According to WindEurope data, the share of wind energy in electricity generation averaged approximately 14% in June.
This is down from 15% recorded during the same period last year, with the share of wind-generated electricity dropping to as low as 9% in the second half of June. A heatwave sweeping the region, with temperatures hovering two degrees Celsius above seasonal norms, represents another key factor driving up energy demand.
Multiple global geopolitical developments underpin the natural gas shortfall confronting Europe. Disrupted shipments of liquefied natural gas (LNG) through the Strait of Hormuz due to hostilities between the US and Iran, combined with production declines in Qatar and the United Arab Emirates (UAE), have tightened global supply.
Meanwhile, in line with decisions by the Kyiv administration, the transit pipeline carrying Russian natural gas to Europe through Ukrainian territory has been completely shut down. The EU must now secure gas not only for its own domestic consumption but also to supply facilities in Ukraine.
In an effort to bypass this halt in Gazprom’s pipeline gas through increased LNG imports, EU countries purchased 109 million tons (approximately 142 billion cubic meters) of LNG last year, representing a 28% increase over the previous year.
However, LNG imports in June fell by approximately 17% compared to the same month last year, dropping to 7.8 million tons—the lowest level in 10 months.
Another critical factor squeezing supply in the European market is the EU’s strategy to phase out Russian energy products entirely.
Russia currently supplies 14% of Europe’s total LNG imports.
According to a phased embargo plan approved by the European Council, LNG imports from Russia will be completely banned starting January 1, 2027.
The import ban on Russian pipeline gas is scheduled to take effect on September 30, 2027. While a transition period is provided for existing contracts, member states have been tasked with the obligation to verify the country of origin for all imported natural gas.
Despite these market uncertainties, the “day-ahead” spot gas price at the Dutch TTF hub—Europe’s benchmark gas trading platform—declined to $475 per thousand cubic meters at the end of June, down from an average of $565 in May.
With a total active gas storage capacity of 109 billion cubic meters, Europe maintains its position as the largest importer in the global LNG market.
Europe
Buckingham Palace updates King’s official role to focus on securing faith in multi-faith Britain
The official job description of the British monarch has been formally revised to state that the King’s role is to “secure the environment for faith” within a multi-faith nation, according to a newly updated definition of the Crown’s responsibilities published by Buckingham Palace.
Under the rewritten description, the King, who holds the title of “Supreme Governor of the Church of England,” is tasked with preserving a supportive space for religious practice.
The adjustment was disclosed in the 2025–26 Sovereign Grant report, the annual financial and administrative review of the royal household. It modifies the definition of the King’s role as “Head of the Nation,” which last year described the monarch as the “Head of the Church of England and Defender of the Faith.”
This year’s report details the role with greater specificity: “His Majesty is Supreme Governor of the Church of England and secures the environment for faith in a multi-faith nation.”
Prior to his coronation, intense public debate centered on whether King Charles III would break with his Christian predecessors by choosing to be styled as “Defender of Faiths” in the plural, rather than the traditional singular “Defender of the Faith.” Ultimately, the King chose to retain the historic singular formulation.
Nevertheless, both during his tenure as the Prince of Wales and since ascending the throne, the King has made interfaith dialogue a cornerstone of his public life.
Regularly referencing the Abrahamic religions, King Charles maintains active engagement with Jewish, Muslim, Sikh, Orthodox, and other religious communities across the United Kingdom and globally.
By contrast, the official role of Queen Elizabeth II, as outlined in the Sovereign Grant reports during her reign, was more straightforwardly defined, styling her as “Supreme Governor of the Church of England” and “Head of the Armed Forces.”
In this year’s assessment, the King’s relationship with the military has been rephrased, stating that he “provides spiritual support to our Armed Forces.”
The updated report also outlines several of the King’s core purposes in detail, describing him as a “catalyst for charitable activity,” recognizing his work on “the degradation of nature,” and highlighting his responsibility to “foster a sense of pride, continuity, and stability, reinforcing the social fabric and cohesion of the United Kingdom, particularly at significant moments in national life, both in times of celebration and tragedy.”
The document adds: “His Majesty also has a particular role in bringing together and engaging with communities and faith groups across the different regions and nations of the United Kingdom.”
Beyond the constitutional and ceremonial adjustments, the report revealed that the King paid £12.9 million in tax during the 2024–25 financial year, a figure that places him among the top 100 taxpayers in the country for that period.
Furthermore, it was announced that the King and Queen will not move their permanent residence to Buckingham Palace even after the ongoing £369 million reservicing and renovation program is completed.
A YouGov opinion poll published on Friday indicated that 66% of the British public support the decision not to relocate to the palace.
This is not the first time Buckingham Palace has revised the formal job description of the reigning monarch.
In 2022, near the end of Queen Elizabeth II’s reign, the Sovereign Grant redefined the role of the monarchy by removing a series of specific duties she “must fulfill,” delegating more responsibilities to the then-Prince of Wales.
That revision marked the first time in at least a decade that the late Queen’s official duties had been altered in the palace’s annual report, removing specific events—such as the State Opening of Parliament—that had previously been deemed mandatory under “constitutional convention.”
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