Europe Today: EU energy prices soar as Spain's housing decrees face Congress vote

Good morning and happy Friday. It's October the 2nd. You're watching Euronews and this is Europe Today. Coming up. European consumers keep being pummeled by rising energy prices. Twelve EU countries reported new diesel price records as supply disruptions pushed the bloc's average to €2.24 a litre. That's compared with €1.59 before the Iran war. We'll speak to EU Energy Commissioner Jürgensen. The student protests across France are getting increasingly violent. At least two schools were set on fire and a headteacher was severely injured. Security forces detained more than 600 people while dozens of police were wounded. The protests against budget cuts in education started last week. And the Spanish parliament will vote on two decrees today that the minority government under Pedro Sanchez approved earlier this week to tackle the housing crisis and protect tenants. Soaring rents, gentrification and the shortage of affordable housing have fueled social and political unrest for weeks. Welcome to the program. I'm Stefan Grober. The EU's energy chief has warned that volatility in the energy market is here to stay. And prices could get even worse. Dan Jürgensen is urging European governments to use existing flexibility to ease the pain at the pump for millions of Europeans. That comes as the Trump administration presses EU countries to release millions of barrels from their emergency oil stocks. Maria Tadeo, our chief editor, spoke to the energy commissioner in Brussels in an exclusive interview. The situation is quite serious. The prices are already quite high and it's felt by our citizens and by our companies. Unfortunately, I also have to say that it is going to become probably even worse during the winter because we do not see any immediate solutions to the crisis in the Strait of Hormuz. And even when it opens, it'll take some time for that to have the effects that we want on the market. So unfortunately, we will see a pressure on fuels. So both oil and gas and diesel and jet fuels during the winter. What measures are you looking at and how quickly can they be implemented? So fortunately, there are things that can be done also on the short term. Most of these things need to be adopted by the member states in the member states. That is, for instance, as we recommend, lowering the tax on electricity. This will lower the costs of living for normal citizens and it will also help transitioning away from fossil fuels into a more electricity-driven economy. So this is just one of the examples that can be done. So as it stands, you do not see a big intervention coming from Brussels. Many things can be done from Brussels and via collective decisions in the European Union. And we have done so. For instance, a grid package and electrification plan. But most of those things are more structural changes. They are very, very necessary. But the things that work tomorrow or the day after tomorrow, that needs to obviously be something that's done nationally. And we have then provided the way for these decisions in Europe by setting up schemes so that you can give subsidies, by setting up schemes so that, for instance, you can have social leasing of electric vehicles instead of combustion engine cars. We have a whole catalogue of things that's been provided as possibilities for member states that they can use. You sent a letter in which you focused on two things to European ministers. The storage levels and also asking for measures for as long as possible to reduce some of the demand for both gas and oil. Is that being answered? And will you at some point have to make that compulsory force a reduction in demand of energy? Yes, I also had a meeting with ministers this week. And it's very clear that we are all very well aware that this is a crisis and things need to be done. Now, it is a little bit different from country to country what member states choose to do. But clearly, demand reduction is one of the most important things that you can do. And even if these measures are mandatory or are not mandatory at this point, would you consider to make them compulsory? If we see this escalation in prices, would you make them an obligation? There's no one-size-fits-all solution here. There's not one silver bullet. Had there been, we probably wouldn't have used it. There's not. But there's a lot of things that you can do. And we have put forward both a catalogue of things that can be done already tomorrow, but also new ideas that hopefully we will get the member states to support on how to electrify our economies faster, on how to make this shift from fossil into renewable energy much faster, on how to implement rules on energy efficiency much faster, because this will also mean that you use less of what it is that we are lacking right now. And when it comes to the storage, there are clear goals that have been set out in terms of the heating season and ahead of winter. The member states, however, they complain that there are two sources of tension. One is hitting the targets, but also if you go to the market now, it comes with an additional bill. In your view right now, what is the priority to save the cash or actually still build up the storage? What we've done is we've coordinated the filling up of our storage facilities of gas all year so to make sure that the bills do not become too high for member states. But it is, of course, expensive when the gas prices are high and we need to strike a balance. I do think that what we've done by loosening the rules so that you don't have to fill the storage as much as you used to will alleviate some of this tension. But it is important for us to have these storages because, as I said, situations can become much worse. So you make the targets flexible, but you don't scrap them? No, we certainly don't scrap the targets. It's very important for our security of supply in Europe and for our security overall that we do have these targets. Do you see any scenario, the most stressed out scenario, heading into the winter in which the European Union faces shortages of energy, and that means lights out? Fortunately, we are not looking into a security of supply crisis. That would be extremely worrisome, of course. But I would like to warn that even though we don't lack fuel, it'll be there, we don't lack the gas, not to neglect the size of the problem, but because for the citizens or the companies that cannot afford it, it'll feel the same way. So if you cannot afford to adequately heat your home, it doesn't really matter that you could actually buy it out there on the market if you cannot afford it. So we do need to take this extremely serious. The energy market is reacting positively to reports that the U.S. is telling allies and forcing allies to release their diesel stocks. Is this going to happen, and is the U.S. telling you, release it and release it quickly? Will you do it? So we are discussing with all members of the International Energy Agency, not only the U.S., on when is the right time to release, because this is one of the opportunities that we have. We've used it before, and it is likely that we will use it again. But this is something that we discuss, of course, in the IAEA. You are saying we're not doing this as a result of pressure from the U.S., but if we do it, and you just said it is a possibility, it's in coordination with the International Energy Agency? It is, of course, a decision of each member state, do they want to do this or not. We try and coordinate via the EU, of course, our positions in the IAEA, and we do this with member states and also other members of the IAEA that are not a member of the European Union. And this is something that is being discussed as we speak. EU Energy Commissioner Dan Jorgensen speaking to Maria Taddeo. For more on the latest price increase, let's bring in Osama Rizvi, Global Market and Product Strategist at Primary Vision, who joins me from Lahore, Pakistan. Good morning and good to see you. Good morning to you as well, Stephen. So, energy prices in Europe are rising again. What is driving this latest increase, and how concerned should consumers and businesses be? Well, as we spoke last time, I think this is just another continuation of the recent events. If you look at the data points, Stephen, there are some positives coming out, because the recent figures show that flows through Strait of Hormuz have recovered a little bit. They've recovered to 80% in some cases to their pre-war levels. But this will take some time if the benefit persists for that benefit to trickle down to the consumers. So, my analysis regarding the consumers suffering economically for the next few months still stands true, unfortunately. And recently, we have seen some refresh spikes as well, Russia, Ukraine especially, and refining sites. So, refining is what matters because the products, diesel and other things, that is what we consumers consume. It is not the crude oil that we're consuming. So, this needs to be looked at very closely. We just heard from EU Energy Commissioner Jorgensen, who was sort of lukewarm on President Trump's idea to ask European countries to release some of their diesel reserves as he mulls a ban on diesel exports. Would releasing diesel reserves have the desired effect on the markets? This is very interesting. I think of many consequences. What the recent war has given to the world is a sudden and painful realization of energy security. And it's still dependent upon the fossil fuels. So, European reserves, 300 million barrels, represents around, even if all of them are released, it will only cover around 10 to 11 days of the world's diesel demand. And the European countries also have to have around 90 days of diesel and other reserves at their home. And Trump's demand, which amounts to around 670,000 barrels per day, it already talks about around 40% of the diesel reserves being depleted. So, I would not be very surprised at the European Energy Commissioner's remarks because we are living in a world where each country, each man is for itself, right? This is the era of energy security, and I would not think that this is going to have a very significant impact on the global diesel prices. Interesting. How much of the current price pressure is coming from global oil and gas markets and how much is specific to Europe? Well, I think two main hubs. So, 20% of the refining capacity in Gulf is off and around 1.2 million to 1.5 million barrels of exports are down when we consider Russia and Gulf. So, these are the two main hubs that, from where the pressure is originating from. Europe and Asian markets, on the other hand, are on the receiving end. When you look at Europe as well, the policy lacunas or policy anomalies, we have seen that in the past few years, from 2009 until now, 30 refineries have already been closed or converted. So now, this is giving a wake-up call that maybe we need to have the approach of energy basket in place where fossil fuels and renewables coexist and we stop pitching them against each other or demonizing any form of energy. So, this is what's going on. Europe has spent the past few years trying to reduce its dependence on Russian energy. Are we now seeing the costs of that strategy sort of feeding back into consumer prices? Definitely, and I think it's very difficult these days, actually, given the integration of global economy, that you can really just wean yourself off of anything. Of course, Europe has increased its gas exports from Norway. Norway provides a lot of gas to Europe. And then LNG from US. US has become the largest provider for LNG for Europe. But each of these countries have their own limitations as well. So, in the time of crisis, you know, you need to look at China. China, as a principle, do not buy anything more than 15% to 20% when it comes to their energy. China is now considering Brazil as their export partner. The Canadian seaborne oil exports to China have increased more than 200% year-on-year basis. So, they're not just relying on Iran. So, we need to, I think, take a page out of their playbook and diversify our energy supplies. Very briefly, Uzama, any advice to consumers? Just don't spend any extra and save as much money as you can and also buy gold. Great. Uzama Rizvi, thanks for breaking it all down for us. Energy is one problem in Europe these days. Finding and keeping a place to live is another. In Spain, the housing crisis is becoming a major political test for Prime Minister Pedro Sánchez. The pressure is mounting both inside Parliament and on the streets. Congress is set to vote on two government-backed measures aimed at tackling soaring rents and protecting tenants. But Sánchez's coalition needs support from parties on opposite ends of the political spectrum, which at this point does not look likely. And a rejection could trigger unpredictable political consequences. As lawmakers prepare for today's votes, protests across the country demand even stronger action. Javier Iniguez in Madrid has more. The countdown begins for what is increasingly becoming one of the most consequential votes for Pedro Sánchez's second term in the Spanish government. And as you can see, the pressure on the Spanish streets, like at the protest camp at Madrid's Puerta del Sol, when we found ourselves, is not backing down. The Congress is voting this Friday on two laws to curb the housing crisis. The socialist government needs a majority that includes both the right-wing Catalan pro-independence party, Junts, and the far-left Podemos. The latter has already announced it will support both laws in Congress. This unfolding of the laws is widely seen as a political manoeuvre to at least get the first one approved. This one has been negotiated alongside the Catalan party. It grants more protection of exhibitions, an increase of taxing for tourist apartments, and more guarantees for tenants. But it also gives a tax bonus for renters that has been widely criticised by the left. The passing of the second law will be more complex. It only legislates on rental contracts, and it would force landlords to compensate tenants with a minimum equivalent of two months' rent if the lease is not renewed, unless one of the parties gives previous notice, among other exceptions. Nevertheless, it is unlikely that Junts will grant support to the second one, and even express its content with the one they negotiated. The tenants' union leading the protest has already confirmed that although they back the laws that the government is trying to pass this Friday, the mobilisation will continue. They have called for a protest in front of every town hall in Spain this Saturday, and some have already talked of a general strike for wild service, considered the current main problem for the Spanish citizens. A very excited Javier Iniguez reporting from Madrid. Thank you very much. Romania is on the front line of Europe's security challenge. Russian drone attacks on Ukraine are spilling into Romanian airspace and along the Black Sea, while Bucharest is warning of a broader campaign of cyberattacks, sabotage and other forms of hybrid warfare. Romania is calling for stronger NATO deterrence on the eastern flank and closer cooperation among European allies. So how serious is the Russian threat, especially the one posed by drone attacks? Earlier I put this question to Romanian Foreign Minister Oana Silvia Toyu. It's definitely an increase in the security risks. We have seen this year, for example, a three-fold increase compared with previous years. It's though the spillover effect of an increased number of attacks that Russia has in targeting Ukrainian infrastructure at our border, the ports, crossing points at the border and so on. It's Russia's strategy to try to create chalk points on Ukraine's economy. And that is why, for example, something that we've done this week in New York and what we aim to build is again something similar with the solidarity lanes. We have had the Black Sea ceasefire moratorium that would enable us, especially through the port of Constanza, to support the proper commercial lanes in the Black Sea, together with Turkey, Bulgaria, Ukraine, of course. Now, you have called for a stronger protection of NATO's eastern flank. What exactly is it that you want from European allies? Is it air defence? Is it more troops? Well, it's not just what we want or what I want. It's rather what we all collectively need. We're talking with partners from the United States in their review process of their European posture to make sure together when we look at the eastern flank, when we look at the Black Sea, when we look at Romania's capabilities, we ensure the fact that together we need a stronger deterrence and defence, not just for our border. It's also when we protect our border, it's also the Schengen border, NATO, the European Union's border. How concerned, Minister, are you about Russian hybrid warfare, the sabotage, the disinformation, the cyber attacks against Romania and other EU countries? The cyber hybrid interferences of Russia are actually their most assertive part directed to countries that are members of the European Union. Be it cyber attacks, and we have proposed for the first time a listing of some individuals that we have analysed to be part of the cyber attacks that have targeted Romania. I've spoken with a lot of my counterparts in terms of the hybrid interferences they see with specific attacks on ammunition and military equipment factories. There's a lot of concern on our capacity to protect from hybrid attacks. The undersea cables, railways in Poland have been the target of hybrid attacks and so on. But it is absolutely necessary both at NATO and at the EU level that we increase not just our analysis capacity, our coordination, but also our capacity to respond in terms of protecting ourselves from this type of hybrid interferences. Romanian Foreign Minister Oana Silvia Toghiu, one of many top guests we had this week, speaking exclusively to Euronews. And that does it for us today. As always, stay tuned for more news on euronews and euronews.com. Thank you for watching. I'm Stefan Grobe. Mev McMahon will be here on Monday. Enjoy your weekend. Take care and see you soon.