Iran War Revives Europe Energy Crisis Fears as Prices Surge
The escalating conflict between the US-Israel and Iran has caused sharp rises in global energy prices, reigniting fears of a major crisis in Europe and prompting urgent White House efforts to manage economic fallout.
European gas prices at the Title Transfer Facility (TTF) benchmark soared to €54.3 per megawatt-hour on 3 March, a significant 70% increase from pre-conflict levels. The rise follows Iran's retaliatory strikes that led Qatar—one of the world's largest liquefied natural gas (LNG) suppliers—to halt production. The effective closure of the Strait of Hormuz, through which about 20% of global oil passes, has further unsettled markets.
EU leaders remain highly alert. Dutch Prime Minister Rob Jetten warned of potential impacts on strategic reserves, while Spanish Prime Minister Pedro Sánchez said his government is preparing possible measures to protect households and businesses. French President Emmanuel Macron announced plans to build an international coalition to secure maritime traffic in key waterways, stating: "We have economic interests to protect because oil prices, gas prices, and the international trade situation are profoundly disrupted by this war."
Although EU officials note that 58% of LNG imports come from the US and only 8% from Qatar, analysts warn that Asian buyers displaced from Qatari supplies will compete for US cargoes, pushing prices higher. The situation brings back memories of the 2022 energy crisis following Russia's invasion of Ukraine, when prices peaked at €348 per MWh.
In Washington, the White House is "looking under every rock for ideas on improving energy prices," according to industry executives. President Trump's chief of staff, Susie Wiles, is urging advisers to find solutions as petrol prices reach their highest levels since Trump assumed office. Options under consideration include a temporary petrol tax holiday and deploying military protection for ships in the Strait of Hormuz. Trump has predicted prices will decline once the conflict ends, saying: "If we have a little high oil prices for a little while, but as soon as this ends, those prices are going to drop, lower than even before."