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ENERGY

European electricity prices soar as tough winter looms

European electricity prices soared to new records on Friday, presaging a bitter winter as Russia's invasion of Ukraine inflicts economic pain across the continent.

electricity pylons at sunset
Energy prices have soared in Europe as Russia has slashed natural gas supplies to the continent. Photo by Matthew Henry on Unsplash

The year-ahead contract for German electricity reached 995 euros ($995) per megawatt hours while the French equivalent surged past 1,100 euros — a more than tenfold increase in both countries from last year.

In Britain, energy regulator Ofgem said it would increase the electricity and gas price cap almost twofold from October 1 to an average £3,549 ($4,197) per year.

Ofgem blamed the increase on the spike in global wholesale gas prices after the lifting of Covid restrictions and Russian curbs on supplies.

The Czech Republic, which holds the rotating European Union presidency, announced Friday that it would convene an EU energy crisis summit “at the earliest possible date”.

Energy prices have soared in Europe as Russia has slashed natural gas supplies to the continent, with fears of more drastic cuts in the winter amid tensions between Moscow and the West over the war.

One-fifth of European electricity is generated by gas-fired power plants, so drops in supply inevitably lead to higher prices.

European gas prices on Friday reached 341 euros per MWh, near the all-time high of 345 euros it struck in March.

The war is not the only culprit in France.

The shutdown of several nuclear reactors due to corrosion issues has contributed to the French electricity price increase as power production has dramatically decreased in the country.

Only 24 of the 56 reactors operated by energy giant EDF were online on Thursday.

READ ALSO: France extends shutdown of four nuclear reactors amid corrosion problems

France, which traditionally exports electricity, is now an importer.

“Winter is going to be a tough period for all the countries in Europe,” Giovanni Sgaravatti, research assistant at the Bruegl think tank in Brussels, told AFP.

“Prices will stay high, possibly they can even go higher,” he said.

READ ALSO: Air-con, ties and lights: How Europe plans to save energy and get through winter without blackouts

Recession ‘probably unavoidable’

A Bruegel study found that European Union countries have allocated 236 billion euros from September 2021 to August 2022 to shield households and firms from rising energy prices, which began to increase as countries emerged from Covid restrictions and soared after the war.

In recent days and weeks, countries have announced energy-saving campaigns to encourage the public to reduce power consumption during the winter.

Germany announced Wednesday that the temperature of public administrative offices this winter would be capped at 19 degrees Celsius (66 degrees Fahrenheit) while hot water would be shut off.

The German measures also include a ban on heating private swimming pools from September and over the six months that the decree is in place.

Finland is encouraging its citizens to lower their thermostats, take shorter showers and spend less time in saunas, a national tradition.

French households are shielded by an energy price cap until December 31 for now.

Industries are also affected by the soaring energy prices.

Factories that produce ammonia — an ingredient to make fertiliser — announced the suspension of their operations in Poland, Italy, Hungary and Norway this week.

HSBC bank warned in a note that “recession is probably unavoidable” in the eurozone, with the economy shrinking in the fourth quarter and the first three months of 2023.

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UKRAINE

France charges two Moldovans over coffin graffiti in Paris

French prosecutors on Saturday charged two Moldovans suspected of painting coffins and a slogan urging an end to Ukraine war on the facade of a prominent Paris newspaper, a judicial source said.

France charges two Moldovans over coffin graffiti in Paris

It was just the latest in a series of such acts in the capital in recent weeks. French officials have repeatedly warned of the risks of disinformation and other attacks by Russia over France’s support for Kyiv.

Tension between Paris and Moscow has increased since President Emmanuel Macron said earlier this year he had not ruled out sending troops to Ukraine.

The two men, who carried Moldovan passports, were arrested overnight Thursday-Friday after six red coffins and the phrase “Stop the Death, Mriya, Ukraine” were painted on the building of right-wing daily Le Figaro. Mriya means “dream” in Ukrainian.

They are being held on charges of destruction of property and participating in “an effort to demoralise the army to harm national defence in peacetime”, the source said.

Six similar coffins were found early Thursday on the facade of the Agence France-Presse headquarters in central Paris, not far from the Figaro offices.

A source close to the case said the two Moldovans claimed to have been paid around €100 to paint the graffiti.

A separate investigations has been opened after graffiti showing French Mirage fighter jets in the form of coffins were found last Tuesday in three districts of Paris. They included the phrase “Mirages for Ukraine”.

Similar graffiti was discovered on the walls of the AFP building Monday.

Macron announced in early June that France would send Mirage-2000 fighter jets to Ukraine and train their Ukrainian pilots as part of a new military cooperation with Kyiv.

On June 8, French police said they were holding three young Moldovans suspected of being behind inscriptions of coffins in Paris with the slogan “French soldiers in Ukraine”.

They were later charged with property damage and released.

Moldova’s Foreign Minister Mihai Popsoi posted on X, formerly Twitter: “We regret and firmly condemn the incident”.

He said the “vandalism” was “part of hybrid tactics to harm our international image”.

Popsoi reiterated his comment on Saturday, denouncing an “instigation to hate”.

“We call on Moldovan citizens to be vigilant and not to allow themselves to be manipulated to the detriment of our country.”

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