Putin said "Russia would cut off energy supplies" if the West imposed price caps

    Photograph: Stanislav Krasilnikov/TASS News Agency/AP

The European Union proposed a price cap on Russian gas on Wednesday hours after president Vladimir Putin threatened to halt all supplies if they took such a step, raising the risk of rationing in some of the world's richest countries this winter.

The escalating standoff threatens to send sky-high European gas prices higher still, adding to already eyewatering bills EU governments are paying to stop their energy providers collapsing and prevent cash-strapped customers freezing in the cold months ahead.

Europe has accused Russia of weaponising energy supplies in retaliation for Western sanctions imposed on Moscow over its invasion of Ukraine. Russia blames those sanctions for causing the gas supply problems, which it puts down to pipeline faults.

EU energy ministers are due to hold an emergency meeting on Friday to discuss how to tackle the energy crisis.

"We'll suggest capping the cost of Russian gas. We need to stop Putin from receiving money from Russia to wage this horrifying war in Ukraine "Ursula von der Leyen, president of the European Commission, told reporters.

The Commission will also propose other measures, such as a cap on the profits from energy produced from other sources and a requirement that electricity use be reduced during peak hours.

Vladimir Putin warned the West on Wednesday that it risked becoming "frozen" like the wolf's tail in a well-known Russian fairy tale if price limitations were imposed on Russia's oil and gas exports. He also threatened to shut off energy supplies.

The Russian president called European requests for a price ceiling on Russian gas "stupid" and claimed they would result in higher worldwide prices and economic issues in Europe when he was speaking at an economic event in the Pacific city of Vladivostok.

Last week, the Group of Seven revealed intentions to impose a price restriction on Russian oil exports, a move that may make it harder for Russia to obtain tankers and insurance from nations outside the G7.

Russia would walk away from its supply contracts if the West went ahead with its plans, Mr Putin said.

“Will there be any political decisions that contradict the contracts? Yes, we won’t fulfill them. We will not supply anything at all if it contradicts our interests,” Mr Putin said.

“We will not supply gas, oil, coal, heating oil — we will not supply anything,” Mr Putin said. “We would only have one thing left to do: as in the famous Russian fairy tale, we would sentence the wolf’s tail to be frozen.”

After Saudi Arabia, Russia is the second-largest oil exporter in the world. It is also the top exporter of natural gas and wheat. Russia typically provides 30% of the oil and 40% of the gas that Europe imports.

According to Mr. Putin, Germany and western nations are to responsible for the Nord Stream 1 pipeline's non-operation, and Ukraine and Poland independently chose to shut down other gas pipelines into Europe.

Due to the Russian state energy corporation Gazprom's complete suspension of gas supplied through Nord Stream 1 following the discovery of an engine oil leak during maintenance work, Europe is currently experiencing a winter fuel crisis and skyrocketing energy costs.

As he called Germany to request the return of a turbine for the pipeline's Portovaya compressor station that would enable Russia to start pumping gas, Mr. Putin declared that "Nord Steam 1 is practically closed now."

There is an oil leak there; it poses a risk of explosion and fire. The turbine is inoperable. We'll start Nord Stream 1 tomorrow if you give us a turbine. However, they provide us nothing, he remarked.