BRUSSELS, 22 November – RIA Novosti. According to relevant associations, the introduction of a mechanism in the European Union to limit gas price increases based on the index of Europe’s largest central TTF threatens financial stability.

“We are deeply concerned about the development of the market adjustment mechanism outlined in Article 23 of the Draft Council Regulation,” the European Association of Energy Exchanges Europex wrote in a letter addressed to European commissioners, energy ministers and finance ministers. said. EU countries.

In mid-October, the European Commission outlined in its draft EU Council resolution the possibility of creating such a mechanism. According to article 23, in the TTF we are talking about “a temporary mechanism to limit the events of excessive gas prices”. The European Commission is likely to submit more specific proposals for this mechanism this week, and EU energy ministers are likely. countries will discuss this at an extraordinary meeting on 24 November.

Europex noted that gas derivatives such as month-to-month TTF futures contracts are an important tool for producers and consumers, including in energy-intensive industries, to hedge the risk of future spot price changes for “blue fuel”. In a letter published on the association’s website, it was stated, “If the maximum price cap is set for the next month of the TTF agreement without first considering the measures specified in Article 23(2), we will see serious risks in terms of financial stability and security of supply.” .

In the second paragraph of this article, it is stated that the mechanism should not threaten the security of EU gas supply and should not affect the stability and normal functioning of the energy derivatives markets. According to Europex, if the actual price of gas exceeds the artificially determined TTF futures price a month ago, “market participants will immediately shift trade to a bilateral swap”. “Such a move would not only lead to a significant reduction in transparency, but would also pose serious risks to financial stability,” the association’s letter states.

The European Federation of Energy Traders (EFET) is also “very concerned that TTF pricing may be subject to interference in the form of a gas market adjustment mechanism.” This is stated in his post. “Restricting the prices of energy derivatives will undermine their functioning and create risks to financial stability,” the report said.