EU Orders Romania to Remove Gas Price Cap, Legal Action Possible

The European Commission has issued a formal warning to Romania over its gas price cap policy, stating that it infringes upon the fundamental principles of free market formation in the wholesale gas market and violates EU energy regulations. The policy, introduced in response to rising energy costs during the pandemic and extended amid the Ukraine war, requires gas producers to sell part of their production at fixed wholesale prices, which the Commission argues distorts market signals and harms both the internal market and consumers. Romania has two months to respond and amend the policy, or the Commission may refer the case to the EU Court of Justice, potentially leading to infringement procedures with consequences including loss of EU funding. The warning comes amid political uncertainty in Romania, with an interim government in place and upcoming presidential elections. While the gas price cap is under scrutiny, Romania’s electricity price cap is not currently included due to pending court rulings. Domestic producers such as OMV Petrom and Romgaz dominate Romania’s gas supply, and the country is poised to become a major gas exporter with upcoming projects like Neptune Deep.