EU split on whether to cap gas prices

The bloc is divided on whether and how to cap the wholesale price of gas.

It comes as Europe braces itself for a difficult winter due to the cost of living and the squeeze on global energy supplies.

The bloc is attempting to wean itself off Russia energy, but it has left it scrambling for other alternative, expensive sources.

A windfall tax is imposed by a government on a company to target firms that were lucky enough to benefit from something they were not responsible for, in other words, a windfall profit.

Demand has increased as the world emerges from the pandemic and supply concerns are raised by Russia's invasion of Ukraine, which is why energy firms are getting more money for their oil and gas than they were last year.

In the UK, former Chancellor Rishi Sunak introduced a similar tax on Friday's EU agreement in May, which he called the Energy Profits Levy.

It was applied to profits made by companies from extracting UK oil and gas, but not those that generate electricity from sources such as nuclear or wind power.