EU weighs tax cuts and subsidies as energy costs surge

European Union leaders are responding to a sharp rise in energy prices linked to the war in Iran and disruptions to supplies through the Strait of Hormuz. The waterway is crucial to the global flow of oil and gas, and recent Iranian attacks on infrastructure in the region are exacerbating the situation.

Gas prices in Europe have already doubled, while Brent crude is rising again.

Brussels is therefore considering temporary measures such as lower electricity taxes, reduced network charges and state aid for companies and households. At the same time, Ursula von der Leyen highlighted significant differences in energy taxation between countries.

Nevertheless, disagreements persist among member states, with some warning of market distortions or widening economic disparities. There is also debate over possible adjustments to the EU Emissions Trading System (ETS), which plays a key role in the bloc’s climate policy.

(reuters, pir)