By Kate Abnett

BRUSSELS (Reuters). European Union leaders will meet at a summit that begins on Thursday. The goal is to collectively buy gas. This comes as they try to lessen reliance on Russian fuels.

Russia invaded Ukraine in 2014, pushing already high prices for energy to record levels. This has led to the EU promising to decrease its dependence on Russian fossilfuels, increasing imports from other nations, and rapidly growing renewable energy.

Moscow declared Wednesday that all “unfriendly”, including EU member countries, must pay in Russian roubles to purchase Russian oil and gasoline. Some EU leaders claimed this was contrary to supply contracts.

Olaf Scholz, German Chancellor, stated that there are “fixed contracts all over the world with the currency in the delivery is to be made being part of those contracts.” It is usually euros or dollars in most cases, and this is what we work on.

Janez Jansa, the Slovenian Prime Minister, stated that nobody will pay in rubles.

Reuters has seen a draft document of the summit’s conclusions. It states that the leaders have agreed to work together to purchase gas, LNG, and hydrogen ahead of winter next year and to coordinate gas storage measures – actions aimed at creating a buffer supply of non-Russian natural gas.

According to the European Commission, it has indicated that it will lead negotiations to pool demand and seek gas. This is similar to how COVID-19 was purchased by the bloc.

The plan will be discussed by leaders on Friday. On the same day, the EU will announce an agreement to U.S. President Joe Biden on additional U.S. Liquid (LNG), supplies for the following two winters.

Russia supplies 40% collective gas demand for the EU – most of it via pipelines. There are also 27% oil imports from Russia, and 46% coal imports.

For three consecutive months, U.S. LNG exporters shipped record amounts to Europe. Prices have increased to over 10x higher than last year, and there has been intense competition for the tight supply.

The decision to directly sanction Russian oil or gas is still a matter of debate between countries. This move was already made by the United States. All 27 EU member countries must approve an EU embargo.

Latvia and Poland want to stop Russia paying hundreds of millions per day for fossil fuels.

Arturs Karins, Latvian Prime Minister, stated that energy sanctions were a means to prevent money from flowing into the war funds of (Russian President Vladimir Putin). Oil and coal are the most natural places to make progress.

Germany and Hungary, both of which account for 18% in Russia’s gas exports are opposed to the embargo. They cite economic damages that an oil embargo could cause.

Rising energy prices are also on the EU summit agenda. Spain and Italy have introduced price caps and measures for decoupling the electricity and natural gas costs to curb consumer spending.

Spanish Prime Minister Pedro Sanchez expressed hope for an “balanced accord” regarding Spain’s proposals. This agreement would include Europe.

Some countries are concerned that the cap on wholesale prices will cause difficulties and hamper efforts to switch to green energy. Some diplomats stated that EU-wide decisions regarding this would likely be postponed until the report of energy regulators this month on potential EU electricity market reforms.

EU nations are responsible in large part for setting their energy policies. To curb rising energy costs, governments have invested billions in tax cuts and subsidies.