Middle East conflict drives up European energy costs

Conflict in the Middle East between Houthi rebels and Saudi Arabia is driving up energy costs for European consumers. Damage to a Saudi Arabian oil pipeline transporting crude to the Red Sea served as a catalyst for Brent crude prices to approach $110 per barrel, while European natural gas (TTF) prices exceeded €80 per megawatt-hour.

Although prices recently retreated toward $102 for Brent and €77 for natural gas, they remain significantly higher than levels seen at the start of 2026—up by 70% and 180%, respectively. European Commission President Ursula von der Leyen stated that since the conflict began in late February, the EU has paid an additional €90 billion for the same quantity of imported fossil fuels.

Supply concerns are compounded by reduced crude oil availability in the Gulf due to US-Iran tensions and Ukrainian attacks on Russian infrastructure. Additionally, LNG exports from Qatar, which account for 20% of the global market, remain blocked as there is no viable way to bypass the Strait of Hormuz.