You are currently viewing ‘Capping energy prices for vital consumption could be a solution’, says Bertrand Candelon, economist at UCLouvain

‘Capping energy prices for vital consumption could be a solution’, says Bertrand Candelon, economist at UCLouvain

  • Post category:Economy News
  • Reading time:2 mins read

How will energy prices evolve in the near future? For the economist Bertrand Candelon, invited on the set of QR the debate, it is difficult to see very clearly. There are factors that could push prices up like the end of zero covid policy in China or winter and other things that can pull prices down like exchange rate and recession.

A priori, the cap on the price of Russian heating oil should theoretically raise the price of fuels and heating oil in our country, but when we see the evolution of the price of oil and future projections, there is no increase significant.

Block prices?

Price freezes are often put forward as the solution to counter the crisis. Bertrand Candelon does not seem really convinced: “Our French neighbors have blocked, they are experiencing a record deficit. Our German neighbors have injected 200 billion, which is obviously very good, but the German budgetary situation is much better than ours with a public debt which is around 60% of GDP whereas we are at 100%. On the other hand, if the prices are soaring again like this summer, so it might be wise to cap vital energy consumption“.

However, to hear the UCLouvain economist, we must be careful with this “solution” price caps. This represents enormous costs for public finances, it is not beneficial for the climate and it especially favors large consumers.