Sweden to Offer Energy Companies Guarantees Worth Hundreds of Billions

Sweden will offer several hundred billion Swedish kronor to energy companies in the form of liquidity guarantees to help avoid a financial crisis following Russian gas giant Gazprom's closure of the Nord Stream 1 gas pipeline, Prime Minister Magdalena Andersson announced, according to Reuters.

The government will present a proposal that will allow it to provide credit guarantees, said Finance Minister Mikael Damberg, adding that all parliamentary parties and the Speaker have been informed.

"If we don't act, there is a serious risk of disruptions in the financial system, which could lead to a financial crisis at worst," Andersson stated.

Sweden is experiencing the highest inflation in the past 30 years, and the central bank has already raised interest rates twice this year, with another sharp increase expected by the end of the year.

The rise in electricity prices, increased interest rates, and slowing economic growth have become major campaign themes ahead of the general elections on September 11.

Damberg announced that the government expects to receive 90 billion Swedish kronor (approximately 8.36 billion USD) to help consumers cope with the record-high electricity prices this year and next.