Council of Europe in Brussels Discussed Energy Price Crisis and Long-Term Financial Plan
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Council of Europe in Brussels Discussed Energy Price Crisis and Long-Term Financial Plan

Twenty-seven member states submitted a demand to the President of the European Commission to present concrete and urgent proposals to mitigate rising energy prices. Furthermore, they instructed the President of the Council of Europe to promote reconciliation efforts between those advocating for budget cuts and those who disagree with reducing funds for cohesion and agriculture.

After two days of discussions, the Prime Minister presented the outcomes of the Council of Europe meeting to journalists in Brussels. The energy price situation, especially fuel prices, was one of the topics that captured the attention of heads of state and government. Despite the absence of final decisions, the meeting resulted in a clear mandate for the European Commission to present measures requiring immediate attention.

The Prime Minister stated, 'The Commission is responsible for the current situation we are experiencing, in terms of correcting positions, for example, by extending the possibility for member states to receive direct aid to certain sectors or apply temporary tax measures. This is coordination carried out by the Commission itself, and the Commission has taken on extending this possibility.'

Brussels has already decided to postpone the entry into force of the methane regulation, which could significantly increase fuel prices, but the Prime Minister noted that leaders want more. He emphasized that the Commission recognizes the need for additional support for specific industries vital to the economies of member states and the economy as a whole, and that it has been mandated to present solutions in this area.

The twenty-seven countries insist that the Commission enhance the efficiency of oil refining processes in Europe to avoid market shortages. It was noted that Europe has lost refining capacity in recent years, making such coordination important for everyone to maintain development amid high uncertainty.

The issue of joint procurement was also discussed. The Prime Minister cited examples such as Portugal's procurement markets in Brazil, Algeria, Nigeria, and the USA. He explained that the main problem with price increases lay in the pricing mechanism, where instability in one production component can collectively affect the price. In the case of gas, the Commission is studying ways to maintain significant price growth linked to international stability. Although joint procurement may not be as beneficial in the oil sector, it is very useful in the gas sector.

Now all eyes are on swift action from the President of the European Commission to mitigate energy prices. Regarding the budget, the desire to move forward in terms of ambition, particularly stimulating economic competitiveness, was reiterated, but without compromising cohesion policy or overall agricultural policy, which are also elements of competitiveness and security at various levels.

The Prime Minister also pointed out an omission in the negotiating framework presented by the President of Ireland regarding the lack of funds directly allocated to ultra-peripheral regions, expressing disagreement with the reimbursement mechanism, which he deemed unfair compared to the overall design of the community, which already provides significant funds for competitiveness.

Portugal, together with Friends of Cohesion, reminded that the share of participation of countries like Portugal today is higher relative to their output than that of more frugal countries, and that increasing this ratio would be unfair.

Regarding the long-term financial plan, there is an expectation that under the leadership of the President of the Council of Europe, diverging positions will converge. The Prime Minister expressed confidence that, despite the impossibility of describing everything that happened over these two days, significant progress has been made because positions have become better known to everyone, paving the way for convergence.

Party Leaders in Brussels

On the day of discussions on competitiveness, energy prices, and the upcoming long-term European budget in Brussels, meetings were also held between political groups of the European Socialist Party, Chega, and Iniciativa Liberal. Three leaders—José Luís Carneiro, André Ventura, and Mariana Mortágua—also addressed journalists to share their views on the issues under discussion.

Marine Le Pen visited Brussels to advocate for a sharp reduction in the European budget starting in 2027 and strengthen the intention to lower France's contribution to the EU budget, setting a 'strict limit' of five billion euros.

In response to a question from RTP Antena 1 about agreeing with the leader of his European political group, the Chega leader stated that the new context must be understood. He emphasized that the level of development of countries like Portugal, Spain, Greece, and Italy cannot be compared with northern countries such as France, the Netherlands, Belgium, Germany, regarding cohesion funds. He added that the eastward expansion of Europe, and now the possibility of Ukraine joining, should not come at the expense of Cohesion Development Funds in Portugal, Spain, Italy, and Greece, as this harms cohesion within the European Union itself.

André Ventura stated that cuts should not harm countries that have already adapted their activities thanks to these cohesion funds. However, in response to a persistent question, the Chega president noted that his European group expresses its opinion on many issues, and they are a group of patriots. He categorically rejected any pension cuts, asserting that Portugal lags significantly in the need to increase pensions, and that European funds should help with this, as pensions are one of the main factors in population impoverishment.

José Luís Carneiro, representing the PS, stressed the importance of Cohesion Policy, speaking about funds intended for regional and territorial cohesion, and how these resources will be managed to support local and regional communities, including the Azores and Madeira archipelagos. He named investment in housing and the social pillar as priorities, which must maintain autonomy to ensure support for training and professional retraining, as competitiveness is only possible with social, territorial, and economic cohesion.

Regarding energy prices, the PS Secretary-General noted that they advocated for temporary support to reduce costs for fuel, electricity, and gas, as well as support for sectors most affected by the energy crisis, and assistance with basic foodstuffs. At the European level, he emphasized that Europe can develop many policies, including increasing energy autonomy, strengthening energy storage and supply connectivity, and using Portugal as an energy supply hub to reduce dependence on Eastern Europe and Russia.

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Leaders of the European Union (EU) intend to maintain a unified approach to escalating energy prices, welcoming the Commission's intention to extend state subsidies and joint purchases.

According to already approved conclusions of the European Council, it supported the European Commission's initiative to extend the temporary framework for state subsidies for the most vulnerable industrial sectors. Furthermore, it was decided to develop a short-term structure to increase the productivity and efficiency of EU refineries, as well as take steps towards voluntary aggregation of energy demand.

The leaders of the 27 countries emphasized that the current situation 'requires an urgent coordinated European response based on targeted and temporary measures, taking into account the specific circumstances of the member states and the protection of the Single Market.'

Thus, the heads of state and government of the EU called on the executive branch to consider and propose, if necessary, new measures to counteract the sharp rise in energy prices in the short term, taking into account the specifics of each member country, including differences in electricity prices.

The EU leaders concluded the summit in Brussels today, where new ways to curb energy prices and advance negotiations on the next general budget were discussed. Financial support for Ukraine was also on the agenda, with Portugal represented by Prime Minister Luís Montenegro.

Energy prices rose sharply after the war initiated by Israel and the United States against Iran, which spread in the region, disrupting, in particular, oil trade.

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Leaders of the European Union (EU), who gathered on Thursday and Friday, plan to request new measures to stabilize energy price growth and prepare for the decisive stage of negotiations on the next European budget, which is currently overseen by the President of the Council of Europe.

Among the main topics of the meeting of the heads of state and government of the 27 EU countries, which began on Thursday morning and will last until Friday evening in Brussels, are the energy crisis, the Multi-annual Financial Framework for the period 2028–2034, support for Ukraine in connection with the Russian invasion, disagreements with the United States (US), and the management of migration flows.

In the energy sector, a high-ranking European official stated that the Council of Europe will ask the Commission to present additional measures to respond to the energy crisis.

EU leaders will have to discuss ways to counteract rising fuel and energy prices amid concerns about the crisis's impact on European competitiveness. According to public sources, this is one of the main political problems for EU leaders, but they acknowledge that there is no 'magic solution' to reduce energy prices for consumers and businesses.

Another high-ranking official noted that there is now an awareness of the need to act at the European level, which was not previously observed.

Among the measures being prepared in the EU are the optimization of capacities of European oil refineries, the pooling of energy demand, and increased coordination in fuel supplies.

Another item for discussion will be the next multi-annual EU budget until 2034, based on the proposal presented last weekend by the Irish Presidency in the EU Council, which calls for an 8% reduction compared to the EU Commission's document.

A high-ranking European official reported that 'the President of the Council of Europe [António Costa] will now lead this negotiation process from this moment until the end of the year, and we will see what can be achieved.'

The institution bringing together the heads of state and government of the EU aims to reach a political agreement as early as 2026. This same official added that 'the deadline we mean is December.'

Another source in the EU indicated that 'elections in 2027 [in some member states] make an agreement unlikely' that year, so there are high expectations to advance this year.

Portugal provided national funding of 35.1 billion euros in the Irish Presidency's EU proposal but requires an additional almost 1 billion euros for ultra-peripheral regions—the Azores and Madeira. Portugal has already threatened to block the agreement if it does not receive this amount stipulated by EU treaties. As stated by the Portuguese diplomatic body, 'for Portugal, there is no agreement without funds for ultra-peripheral regions.'

According to EU sources polled by the Lusa agency, a 'more concrete stage' of budget negotiations is now beginning, although they stressed that this high-level meeting will not present long and detailed written conclusions on this matter.

The discussion is focused on balancing traditional priorities, such as cohesion and agriculture, with strengthening areas such as competitiveness, defense, and research.

New sources of revenue to finance the European budget will also be a central issue, as several member states demand smaller national contributions.

On Friday, leaders will meet with Ukrainian President Volodymyr Zelensky in Brussels to discuss support for Kyiv against the backdrop of new tensions surrounding the diplomatic initiatives of US President Donald Trump. Trump announced an energy truce between Russia and Ukraine last week, but Kyiv condemned new Russian attacks on energy facilities, casting doubt on the application of this agreement.

Tensions have also increased due to the deal announced by Trump on purchasing Russian diesel fuel, which European officials called 'regrettable' because it contradicts the EU strategy to reduce energy dependence on Moscow and limit revenues financing the war. Despite disagreements with Washington, European sources rejected the idea that Brussels is being ignored by the US and supported the continuation of dialogue.

Leaders will also have to discuss financing Ukraine's needs after 2026 and the European response to hybrid threats attributed to Russia.

Migration will be another central topic, as EU heads of state and government discuss reactions to crises such as the situation in the Spanish enclave of Ceuta, where the mass influx of migrants in the summer revealed weaknesses in external border management.

Prime Minister Luís Montenegro will represent Portugal at the high-level meeting.

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