All news

EU warns of possible prolonged energy crisis — Reuters

According to the estimates, if tensions continue, energy markets would face a prolonged supply shock and extreme price spikes, with ripple effects across industries’ supply chains

LONDON, April 15. /TASS/. Brussels has warned member countries that if the Middle East conflict continues, energy markets will face a prolonged supply shock, Reuters reported, citing EU diplomats.

In a closed-door meeting with EU countries’ ambassadors, the European Commission (EC) said it was considering two main scenarios, the agency said, citing diplomats with knowledge of the talks. In a scenario where the ceasefire agreed between the US and Iran holds, and the US blockade of the strait is lifted, oil and gas flows recover in a few months and prices should decline.

However, if tensions continue, energy markets would face a prolonged supply shock and extreme price spikes, with ripple effects across industries’ supply chains. Continued oil supply disruption would result in a reduction in fuel consumption, the Commission said. In this scenario, Europe could struggle to fill its gas storage ahead of winter. Localized shortages of jet fuel are also possible, the Commission said, according to the diplomats.