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A year has passed since the EU launched the REPowerEU plan in response to the energy crisis triggered by the Ukraine war. REPowerEU aims to reduce dependency on Russian fossil fuels by diversifying energy supplies, increasing investment in renewables and cutting energy consumption. It has had a promising start, but market dynamics have been kind. Further supply tightness due to unplanned outages or increasing gas demand amid falling prices could derail progress, while the speed of the renewables buildout will dictate future gas demand. Russia's move to cut piped gas volumes last year resulted in European gas prices spiking to record highs, which piled pressure on Brussels to help businesses and consumers struggling with soaring energy bills. Brussels announced several measures under the REPowerEU plan aimed at balancing the market and calming prices, many of which succeeded. Targets to cut gas consumption and fill gas inventories were exceeded but not without market pain, as industry bore the brunt of demand cuts and the storage obligation saw a rush to buy expensive spot gas — some of which was unhedged. The EU introduced a gas price cap, but this looks unlikely to be activated as prices are much lower than the trigger threshold.

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