Electricity and gas bills, petrol prices: this is why they will remain high for years

The analysis at Money.it by Michele Polo, professor of Political Economy at the Bocconi University in Milan

Gas, electricity and petrol will remain very expensive for years, even after the war in Ukraine ends. As Michele Polo, professor of Political Economy at Bocconi University in Milan, explains to Money.it, when the European Union will finish replacing all energy goods coming from Moscow (for Italy in 2024), avoiding the speculations induced by the Kremlin , however, will have to deal with more expensive imports, especially as regards gas.

The new methane, in fact, will come largely in the form of liquefied natural gas, “which involves a series of expensive regasification and treatment processes and which sees us compete with all other world markets”. As for the rest, which will come from non-Russian gas pipelines (therefore from Algeria, Libya, Azerbaijan and Norway), there is an increase in demand from producers and therefore the price will increase.

Also with regard to oil, despite the European embargo from next January and the price cap just approved in the West, OPEC + continues and will continue to greatly influence the price, as seen with the latest production cut. which brought up Brent and Wti and therefore also the price of gasoline at the pump.

For this Polo he is convinced that the time has come to create a common fund to support a generalized price cap on energy goods, which “would have economic and political justifications, because the crisis also depends on the choice of the whole Union to support the ‘Ukraine”.

The reform of the Ttf market in Amsterdam, to which the price of methane is linked, instead risks being an ineffective buffer measure, which for the professor would help to modify the formation of prices, but the fact remains that in the contracts there is a buyer. and a seller and you cannot change everything unilaterally.