NATO defense chiefs gather for a second day of meetings in Brussels today, and will discuss how to increase security of critical infrastructure in the aftermath of last month’s sabotage attacks on the Nord Stream gas pipelines. Russian President Vladimir Putin warned yesterday that any energy infrastructure in the world is at risk. Meanwhile, US Defense Secretary Lloyd Austin said he expects NATO allies to come forward with more air-defense capabilities for Ukraine, especially following recent strikes on major cities. The alliance is also set to agree on new targets for stockpiling weapons, as they encourage manufacturers to boost production given depleted reserves. - Natalia Drozdiak and John Follain
What’s Happening
Edging Closer | The European Commission will propose a new package of measures next week as it grapples with the energy crisis. They’ll include joint purchasing of gas and setting up a new gas-market benchmark to calm volatility. But the key question is whether officials believe they have enough support to put on the table a measure to cap gas prices in the electricity market, which some fear could spur energy demand.
Oil Cap | Some Biden administration officials are growing concerned that their plan to cap the price of oil purchased from Russia may backfire after the OPEC+ alliance’s surprise production cut last week, people familiar with the matter told us. The plan seeks to keep enough Russian supplies on the global market to stave off a spike in prices, but the proposal has been complicated since its inception and the subject of intense diplomacy with European allies.
Oil Leak | Polish authorities are assuming a leak in a pipeline bringing Russian oil to Europe is probably an accident. Investigations continue, but Mateusz Berger, Poland’s top official in charge of strategic energy infrastructure, said he has no reason to think it was an act of sabotage. European authorities are on high alert since the Nord Stream blasts.
Deep Freeze | Households in Europe could still freeze during a severe cold snap this winter, despite the continent having almost filled its gas storage facilities, Gazprom’s head Alexey Miller warned. EU governments are in talks to hire giant floating power plants, which could dock off the bloc’s ports in December, according to Istanbul-based Karpowership, which owns a fleet of the vessels.
Political Void | A political deadlock has given Bulgaria’s president uncommon power, posing risks to Western efforts to punish Putin. After a fourth election in 18 months failed to produce a clear ruling majority, chances are slim a new government will emerge soon. That has left former general Rumen Radev in charge and wielding more influence than his mostly ceremonial position usually commands.
In Case You Missed It
Shrinking Germany | Europe’s energy crunch will likely trigger a contraction in the German economy next year for the third time since the financial crisis, the Economy Ministry predicted in updated projections. Germany is especially vulnerable to an energy shock having built up a heavy reliance on imports of Russian fossil fuels in recent decades.
Bank Strategy | The ECB should pursue forceful increases in borrowing costs at its October and December meetings, Governing Council member Klaas Knot told Bloomberg Television. The Dutch central bank chief said that euro-area interest rates are “still way below neutral” — referring to the level at which policy is neither stimulative nor restrictive.
Punishing Tehran | The EU agreed on the need to impose new sanctions on Iran over its treatment of women and a deadly crackdown on recent protests, according to diplomats. A package of specific sanctions on at least 15 people and entities could be approved as early as next week, they said.
Inching Forward | The EU has proposed granting candidate status for membership in the bloc to Bosnia-Herzegovina, commission chief Ursula von der Leyen said. The step is a conditional one, under which Bosnia will have to take steps related to democracy, functionality of state institutions, the rule of law and fighting corruption, among others.
Far-Right Challenge | Estonia’s nationalist EKRE party is surging in polls, posing a potential challenge to Prime Minister Kaja Kallas’s grip on power in the Baltic nation ahead of parliamentary elections in March. The euro-skeptic and anti-immigrant party has narrowed the gap with Kallas, who has seen her personal popularity soar as a leading critic of Putin’s invasion of Ukraine.
Gas Lanterns | Like other cities worldwide, Berlin began installing gas lanterns along its avenues and alleyways in the early 19th century. But while the rest of the planet has long since moved on to sodium, halide, and LED, the German capital has remained stubbornly old-school. Today, Russia’s war in Ukraine is hastening the technology’s demise.
Chart of the Day
Russia has been increasing fuel deliveries to its military units near and inside Ukraine, with shipments reaching the highest since the invasion as the Kremlin mobilizes its forces against Kyiv’s counteroffensive. Gasoline, diesel and jet fuel deliveries to the Russian Defense Ministry’s units in six regions bordering Ukraine, as well as the annexed Donetsk and Luhansk regions, rose to almost 220,000 tons in September, according to our calculations based on an analysis of railway data. That’s about four times the volume of a year earlier and exceeds shipments in March, the first full month after the invasion.
Today’s Agenda (All times CET.)
- 9 a.m. NATO defense ministers meet in Brussels with alliance chief Jens Stoltenberg holding a news conference at 4:30 p.m.
- 9.30 a.m. EU justice ministers meet in Luxembourg
- 10.15 a.m. EU foreign policy chief Josep Borrell delivers a speech at the European Diplomatic Academy, Bruges; press conference at 11.35 a.m.
- 7 p.m. Commission Vice President Frans Timmermans in panel discussion at Progressive Governance Summit in Berlin
- 8:30 p.m. Financial Services Commissioner Mairead McGuinness speaks at Institute of International Finance meeting in Washington
- Timmermans speaks at EU Ambassadors Conference in Brussels
- Health commissioner Stella Kyriakides meets US Secretary of Health and Human Services Xavier Becerra in Washington