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European Union countries considered the latest proposal for a lower gas price ceiling of 220 euros - exactly a week before a meeting where the united bloc hopes to resolve the issue that has deeply divided the 27 member states, Reuters reports.

Several countries, including Europe's biggest economy Germany, have opposed the idea of ​​any price cap, saying it could make it harder to secure supplies, while Belgium, Italy and Poland see such a cap as a way to protect consumers and economies from the shock of high energy prices.

Under a compromise proposed late Monday by the Czech Republic, which holds the EU's rotating presidency, the cap would be introduced if prices exceeded 220 euros per megawatt hour for five consecutive days on Dutch gas hub TTF near-term futures, according to the latest proposal, dyadic from Reuters.

The TTF price, which serves as the European benchmark, also needs to be €35 higher than the liquefied natural gas (LNG) benchmark price based on the numerous existing LNG price estimates to trigger this cap.

The revised proposal also increases the scope of the price cap, which will no longer cover only month-ahead futures contracts traded on the Dutch gas hub TTF, but also contracts between one and three months ahead.

Germany introduces gas price cap from January

The new proposal also expands the reference markets for calculating the average LNG price to include LNG prices in Asian markets.

The new Czech compromise is below the limit of 275 euros per MWh proposed on November 22 by the European Commission, which, however, was not approved by European energy ministers.

Some EU diplomats, speaking on condition of anonymity, told Reuters that the countries' positions had not changed and predicted that another meeting on December 19 might be needed after ministerial talks next Tuesday.

The permanent ambassadors of the EU countries will discuss the latest draft proposal on Wednesday to try to get closer to reaching an agreement.

Member states unhappy with the EU's proposal also made their own proposals.

The Netherlands has proposed a price cap only for government-backed gas purchases, while countries including Belgium and Poland offer a variable cap.

The Commission has been reluctant to propose a price cap, which some EU countries have been demanding for months, and its proposal (of a €275/MWh cap) has been widely criticized as being too high and accompanied by such strict conditions that it is unlikely to actually be triggered .

Gas prices have risen sharply this year following Russia's incursion into Ukraine, until then Europe's leading exporter of the blue fuel, although it has since fallen from record highs of more than €340 per megawatt hour reached in August as European countries filled their gas storages in an attempt to protect themselves from gas shortages during the winter months.

Meanwhile, gas TTF futures for delivery in January 2023 traded flat on Tuesday around €135 per megawatt hour.

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