Habeck Scholz
© AP Photo/Markus SchreiberGerman Economy and Climate Minister Robert Habeck (L), Chancellor Olaf Scholz (C) and Finance Minister Christian Lindner (R) brief the media.
Germany's government says it will spend up to €200 billion to help consumers and businesses cope with rising energy prices.

Chancellor Olaf Scholz announced on Thursday that the government is reactivating an economic stabilising fund and "will do everything it can" to bring prices down.

Comment: Without Russia's critical supplies, there's not much it can do. Well, unless they plan on going all Weimar and literally burning money to stay warm.

Prices for natural gas -- used to heat homes, generate electricity, and power factories -- have surged across Europe amid Russia's invasion of Ukraine.

Comment: Russia's special operation in Ukraine didn't stop energy supplies, the West sanctioned itself out of the market.

Germany previously used the so-called "defensive shield" to support the country during the global financial crisis and the COVID-19 pandemic. The fund will cap the price German customers pay for gas and relieve them from inflation.

A previously proposed surcharge that was meant to help spread the rising cost of purchasing fuel on the global market is now being dropped.

"One could say this is a double-whammy," Scholz told a news conference by video link.

Scholz said recent leaks on two pipelines further showed that Russian energy supplies couldn't be expected in the near future.

Comment: 'Recent leaks' - even Western governments and media have acknowledged that this is likely sabotage by way of explosives by state actors.

"We're well prepared for this situation though," he said. "We have taken decisions that allow us to deal with this."

Comment: If threatening rolling blackouts and deindustrialisation is being 'prepared', then indeed Germany is.

Finance Minister Christian Lindner insisted that the economic stabilising fund meant Germany would not be following the UK's path.

The British government recently announced tax cuts funded by borrowing, despite plans to spend billions shielding homes and businesses from soaring energy prices. The move resulted in a sharp fall in the pound.

Comment: Perhaps in part, but it seems the plunging pound never really recovered from the 2008 crash - largely a result of corruption - and has merely been on QE life support ever since: UK pension funds bond crash prompts historic Bank of England emergency intervention

Germany is paying a high price for its dependence on Russian gas, which accounted for 55% of its gas imports before the war in Ukraine.

"We cannot accept this and we are fighting back," he told the news conference, adding that the new aid measures as "a clear response to Putin".

The German government has already unveiled support measures totalling around €100 billion.