BRUSSELS — The European Commission will make a proposal to boost the bloc’s carbon market reserve within “days” and develop a €30 billion decarbonization fund, in response to pressure from EU leaders to limit the CO2 price’s impact on electricity bills. Commission President Ursula von der Leyen said the EU executive would work on a mix of immediate relief and structural changes to bring down high energy prices, with measures to tackle all components of the power bill, from taxes and levies to carbon costs. Two measures to tweak the Emissions Trading System (ETS), which requires factories and power plants to purchase a permit for every ton of CO2 they emit, “will come in the next days,” von der Leyen said at a press conference following Thursday’s EU leaders’ summit. They include an update to the so-called benchmarks that determine how many free-of-charge permits a certain industrial sector receives and a proposal to “increase the firepower” of the Market Stability Reserve governing the ETS permit supply. In what she described as the “medium term,” von der Leyen pointed to the review of the ETS scheduled for this summer, as well as a new “ETS investment booster” providing financial support to industry. This booster, first reported by POLITICO on Thursday, will “have a budget of round about €30 billion, financed by 400 million ETS allowances,” she said. “The aim is to finance projects for decarbonization” under a first-come, first-served scheme with a focus on lower-income EU countries. In their summit conclusions, leaders asked the Commission to conduct the ETS review “by July 2026 at the latest, to reduce the volatility of the carbon price and mitigate its impact on electricity prices … while preserving the essential role of the ETS.” Compared to previous drafts, the final conclusions also “invited” the Commission “to work closely with Member States to design national temporary and targeted measures” to rein in high energy prices. This addition was seen as catering to countries such as Italy and Poland, which had cited their national circumstances — in particular, high reliance on fossil fuels in their power mix — as reasons for more substantial changes to the ETS, two diplomats said. Asked specifically about a controversial Italian decree subsidizing power companies to make up for their ETS costs, von der Leyen said: “Because of different energy mix in different member states you cannot have one-size-fits-all” and vowed to “work closely with the Italian government on the Italian decree.” In general, she said, Thursday’s summit was “positive for the ETS.” The bloc’s bedrock climate measure escaped demands for fundamental changes from leaders and was widely praised as a key lever for accelerating the bloc’s transition to cheaper clean energy.

Dr. Daniel Steiners This is not an obituary for Germany’s economic standing. It is an invitation to shift perspective: away from the language of crisis and toward a clearer view of our opportunities — and toward the confidence that we have more capacity to shape our future than the mood indicators might suggest. For years, Germany seemed to be traveling along a self-evident path of success: growth, prosperity, the title of export champion. But that framework is beginning to fray. Other countries are catching up. Parts of our industrial base appear vulnerable to the pressures of transformation. And global dependencies are turning into strategic vulnerabilities. In short, the German model of success is under strain. Yet a glance at Europe’s economic history suggests that moments like these can also contain enormous potential — if strategic thinking and decisive action come together. One example, which I find particularly striking, takes us back to 1900. At the time, André and Édouard Michelin were producing tires in a relatively small market, when the automobile itself was still a niche product. They could have focused simply on improving their product. Instead, they thought bigger; not in silos, but in systems. With the Michelin Guide, they created incentives and orientation for greater mobility: workshop directories, road maps, and recommendations for hotels and restaurants made travel more predictable and attractive. What began as a service booklet for motorists gradually evolved into an entire ecosystem — and eventually into a globally recognized benchmark for quality. > In times of change, those who recognize connections and are willing to shape > them strategically can transform uncertainty into lasting strength. What makes this example remarkable is that the real innovation did not lie in the tire itself or merely even a clever marketing idea to boost sales. It lay in something more fundamental: connected thinking and ecosystem thinking. The decision to see mobility as a broad space for value creation. It was the courage to break out of silos, to recognize strategic connections, to deepen value chains — and to help define the standards of an emerging market. That is precisely the lesson that remains relevant today, including for policymakers. In times of change, those who recognize connections and are willing to shape them strategically can transform uncertainty into lasting strength. Germany’s industrial health economy is still too often viewed in public debate in narrowly sectoral terms — primarily through the lens of health care provision and costs. Strategically, however, it has long been an industrial ecosystem that spans research, development, manufacturing, digital innovation, exports and highly skilled employment. Just as Michelin helped shape the ecosystem of mobility, Germany can think of health as a comprehensive domain of value creation. The industrial health economy: cost driver or engine of growth? Yes, medicines cost money. In 2024, Germany’s statutory health insurance system spent around €55 billion on pharmaceuticals. But much of that increase reflects medical progress and the need for appropriate care in an aging society with changing disease patterns. Innovative therapies benefit both patients and the health system. They can improve quality and length of life while shifting treatment from hospitals into outpatient care or even into patients’ homes. They raise efficiency in the system, reduce downstream costs and support workforce participation. > In short, the industrial health economy is not merely part of our health care > system. It is a key industry, underpinning economic strength, prosperity and > the financing of our social security systems. Despite public perception, pharmaceutical spending has remained remarkably stable for years, accounting for roughly 12 percent of total expenditures in the statutory health insurance system. That figure also includes generics — medicines that enter the ‘world heritage of pharmacy’ after patent protection expires and remain available at low cost. Truly innovative, patent-protected medicines account for only about seven percent of total spending. Against these costs stands an economic sector in which Germany continues to hold a leading international position. With around 1.1 million employees and value creation exceeding €190 billion, the industrial health economy is among the largest sectors of the German economy. Its high-tech products, bearing the Made in Germany label, are in demand worldwide and contribute significantly to Germany’s export surplus. In short, the industrial health economy is not merely part of our health care system. It is a key industry, underpinning economic strength, prosperity and the financing of our social security systems. Its overall balance is positive. The central question, therefore, is this: how can we unlock its untapped potential? And what would it mean for Germany if we fail to recognize these opportunities while economic and innovative capacity increasingly shifts elsewhere? Global dynamics leave little room for hesitation Governments around the world have long recognized the strategic importance of the industrial health economy — for health care, for economic growth and for national security. China is demonstrating remarkable speed in scaling and implementing biotechnology. The United States, meanwhile, illustrates how determined industrial policy can look in practice. Regulatory authorities are being modernized, approval procedures accelerated and bureaucratic barriers systematically reduced. At the same time, domestic production is being strategically strengthened. Speed and market size act as magnets for capital — especially in a sector where research is extraordinarily capital-intensive and requires long-term planning security. When innovation-friendly conditions and economic recognition of innovation meet a large, well-funded market, global shifts follow. Today roughly 50 percent of the global pharmaceutical market is located in the United States, about 23 percent in Europe — and only 4 to 5 percent in Germany. This distribution is no coincidence; it reflects differences in economic and regulatory environments. At the same time, political pressure is growing on countries that benefit from the American innovation engine without offering an equally attractive home market or recognizing the value of innovation in comparable ways. Discussions around a Most Favored Nation approach or other trade policy instruments are moving in precisely that direction — and they affect Europe and Germany directly. For Germany, the implications are clear. Those who want to attract investment must strengthen their competitiveness. Those who want to ensure reliable health care must appropriately reward new therapies. Otherwise, these global dynamics will inevitably affect both the economy and health care at home. Already today, roughly one in four medicines introduced in the United States between 2014 and 2023 is not available in Europe. The gap is even larger for gene and cell therapies. The primacy of industrial policy: from consensus to action — now Germany does not lack potential or substance. We still have a strong industrial base, a tradition of invention, outstanding universities and research institutions, and a private sector willing to invest. Political initiatives such as the coalition agreement, the High-Tech Agenda and plans for a future strategy in pharmaceuticals and medical technology provide important impulses, which I strongly welcome. > A fair market environment without artificial price caps or rigid guardrails is > the strongest magnet for private capital, long-term investment and a resilient > health system. But programs must now translate into a coherent action plan for growth. We need innovation-friendly and stable framework conditions that consider health care, economic strength and national security together — as a strategic ecosystem, not as separate silos. The value of medical innovation must also be recognized in Germany. A fair market environment without artificial price caps or rigid guardrails is the strongest magnet for private capital, long-term investment and a resilient health system. Faster approval procedures, consistent digitalization and a determined reduction of bureaucracy are essential if speed is once again to become a competitive advantage and a driver of innovation. Germany can reinvent itself, of that I am convinced. With courage, strategic determination and an ambitious push for innovation. The choice now lies with us: to set the right course and unlock the potential that is already there.

BRUSSELS — The head of the International Energy Agency on Tuesday summoned an extraordinary meeting to decide whether to tap millions of barrels of emergency oil supplies amid soaring energy costs. The meeting, to be held at an undisclosed time on Tuesday, will “assess the current security of supply and market conditions to inform a subsequent decision on whether to make emergency stocks of IEA countries available to the market,” the agency’s chief, Fatih Birol, said in an emailed statement. The IEA’s 31 members — mostly advanced Western economies — have grown increasingly panicked as Iran and a U.S.-Israeli coalition trade airstrikes, imperilling critical supply chains and energy infrastructure across the Gulf. Merchant shipping has also abandoned the Strait of Hormuz, a chokepoint for 20 percent of the world’s energy trade, prompting fears of price spikes. The IEA’s members have yet to coordinate on measures to address the crisis, citing uncertainty over how long the war will last. Benchmark oil prices skyrocketed to over $100 a barrel in the first week of the war, before settling at $88 on Tuesday after U.S. President Donald Trump implied that the conflict was nearing a conclusion. Member countries currently hold over 1.2 billion barrels of emergency oil supplies as well as a further 600 million held under government obligation, Birol said.

Russian President Vladimir Putin entered the new year facing a painful choice — limit his so-called special military operation in Ukraine or risk serious damage to his economy. Almost overnight, U.S. President Donald Trump handed him the solution. U.S.-Israeli strikes on Iran have sent oil prices soaring, boosting the Kremlin’s main source of revenue and making it easier for Putin to sustain his war effort. After Israel bombed Iranian oil facilities this weekend, benchmark crude prices soared to above $100 per barrel, hitting their highest mark since the summer of 2022, when markets spiked following Russia’s full-scale invasion of Ukraine. For Russia, the surge in oil prices amounts to an economic windfall at a crucial moment, as the cost of four years of war in Ukraine threatened to spill over into a domestic economic crisis. The assault on Iran may undermine Moscow’s claim to stand by its allies, but it is already benefiting Russia’s economy and, by extension, its war against Ukraine — leaving the Kremlin well placed to emerge as one of the main beneficiaries of the expanding conflict in the Middle East. ECONOMIC TURNAROUND Only several weeks ago, the mood among Russia’s economic elite was grim. The Russian finance ministry’s budget plan for this year assumed a baseline benchmark of $59 per barrel of Urals crude, the country’s main export blend. But in January, energy revenues plunged to their lowest level since 2020, compounding a disappointing tax haul. As Western sanctions, high interest rates and labor shortages strained the economy, tension between the finance ministry and the central bank on how to mitigate the damage became increasingly visible. “It was far from a collapse,” said Sergey Vakulenko, a senior fellow at the Carnegie Russia Eurasia Center. “But the government was facing tough choices, had to cut its spending and raise taxes and even consider some reduction in military expenditure.” Stopping the war in Ukraine was never on the table, Vakulenko added, but it was becoming clear that even on that front, Russia would have to “economize a bit.” Then Israel and the U.S. attacked Iran. As Tehran retaliated and the conflict spilled over into a regional war, shipping through the Strait of Hormuz has stalled, sending oil prices soaring. “Suddenly, Moscow received this gift,” said Vladimir Milov, a former deputy energy minister turned Kremlin critic in exile. “They had their lifeline.” These days, he said, Russian officials are “very, very happy.” ‘STRATEGIC MISTAKE’ Instead of selling at a discount because of Western sanctions, Russian crude may now fetch premium prices as its main buyers — India and China — scramble to secure supplies. What’s more, they’ll have Washington’s blessing.  Last Friday, the U.S. Treasury issued a 30-day waiver allowing India to buy Russian crude to “enable oil to keep flowing into the global market.” A day later, Treasury Secretary Scott Bessent said the United States could “unsanction other Russian oil,” a sharp reversal from last year’s policy of penalizing countries for buying Russian energy. Unsurprisingly, the Kremlin is using the moment to maximum advantage.  “Russia was and continues to be a reliable supplier of both oil and gas,” Putin’s spokesperson Dmitry Peskov told reporters on Friday in what sounded like a sales pitch, adding that demand for Russian energy products had increased. Meanwhile, Kremlin aide Kirill Dmitriev gloated in a series of posts on X that “the oil shock tsunami is just beginning,” criticizing Europe’s decision to cut itself off from Russian energy as “a strategic mistake.”  On Monday, pro-Kremlin commentators circulated a Wall Street Journal article predicting oil prices could skyrocket to $215. LONG GAME Energy experts warn it is too soon for Moscow to claim victory. Whether the Iran crisis proves a cure for Russia’s economy depends directly on how long it lasts. Milov, the former deputy energy minister, said that, to make a meaningful difference for the economy, Russia would need oil prices to remain at current levels for roughly a year. “One or two months of high prices would certainly help, but it won’t save it,” he said. A brief spike in prices will only “help to postpone the difficult decisions,” added Vakulenko, the analyst at the Carnegie Russia Eurasia Center.  There’s another reason why Moscow will be hoping the war drags on: With every day of fighting, the U.S. is depleting the weapon stocks Ukraine is relying upon to defend itself.  According to media reports, Russia has been providing Iran with intelligence to help it target U.S. warships and aircraft.  The assassination of Iran’s leader Ali Khamenei in a U.S.-Israeli airstrike may have dealt a blow to Russia’s promise to defend its allies, but Putin may ultimately decide it was a price worth paying.

PARIS — The rising price of oil is undermining the European Union’s efforts to rein in Vladimir Putin’s shadow fleet of sanctioned oil tankers. Russian oil is in high demand as the war in the Middle East and tensions around the Strait of Hormuz tighten global supply, sending benchmark crude prices above $100 per barrel on Monday. That risks weakening a central plank of the EU’s efforts to cut off funding for the Russian president’s war in Ukraine: making it harder and more expensive for Moscow to export oil through a network of aging vessels operating outside the Western shipping system. EU countries have already sanctioned hundreds of tankers and are working on new measures aimed at the insurance, crewing and other maritime services that allow those ships to operate — tools Brussels hopes will make the shadow fleet increasingly costly and difficult to run. But a tighter oil market means buyers may still be willing to purchase discounted Russian crude. As prices rise, the financial incentive to secure cheaper Russian barrels grows, offsetting the higher risks and costs associated with sanctioned ships. The demand is expected to be driven by Asian countries like China and India — the world’s first and third-largest importers of oil — which rely heavily on Middle Eastern supplies and are likely to turn to Russia to make up for any shortfalls. Indian refiners have already reportedly moved to buy more Russian crude after the U.S. temporarily eased pressure on the South Asian country by allowing purchases to resume last week. India imports, on average, 10 million metric ton of crude oil per month through the Strait of Hormuz, said Vaibhav Raghunandan, an EU-Russia analyst at the Centre for Research on Energy and Clean Air. “Even if half of this volume is replaced with Russian volumes at sea, it will translate to huge profits for the Kremlin.” The shift comes after millions of barrels of oil were stranded at sea last week as escalating tensions blocked the Strait of Hormuz, a maritime choke point through which a fifth of the world’s oil and liquefied natural gas flows. Meanwhile, around €1.3 billion of Russian crude is currently at sea looking for buyers, Raghunandan estimates. SANCTIONS STALL The market squeeze also comes at a difficult moment for Brussels. The EU is trying to push through a new sanctions package aimed at tightening restrictions on Russia’s shadow fleet — including limits on maritime services — but the proposal is currently stalled after Hungary vetoed the plan. The shadow fleet includes hundreds of aging tankers used to transport Russian crude outside Western oversight. Last month, President Donald Trump announced a trade deal with Indian Prime Minister Narendra Modi that included a commitment from New Delhi to halt purchases of Russian oil in exchange for reduced trade barriers with the United States. | Andrew Harnik/Getty Images EU foreign policy chief Kaja Kallas warned last week that rising oil prices risk boosting Moscow’s war effort. “When the oil price goes up, it actually benefits Russia to fund its war,” she said, making the case for the maritime services ban at a virtual meeting of EU foreign ministers. Malte Humpert, founder and senior fellow at The Arctic Institute, said a prolonged Iran–U.S. conflict would likely benefit Moscow by pushing energy prices higher. “Rising prices for sure,” he said, noting that Russian oil and gas revenues have been declining in recent months.  “The question is how long the Hormuz situation is going to last,” he added. “If this is over in a week, the effects are probably negligible. If this continues for a few weeks … especially as we’re getting into the summer months, that’s when exports really pick up again from the Russian side.” Humpert argued that supply disruptions “always favor the seller who can deliver on time, reliably and discounted.” India has been a key buyer of Russian crude since the start of the war in Ukraine, though purchases had recently declined under pressure from Washington. Last month, President Donald Trump announced a trade deal with Indian Prime Minister Narendra Modi that included a commitment from New Delhi to halt purchases of Russian oil in exchange for reduced trade barriers with the United States. Before that, Indian ports had become a major destination for tankers carrying Russian crude that were shut out of Western markets by sanctions. Last September, the Boracay, a ship under EU sanctions carrying approximately $100 million in Russian oil, was boarded by the French navy, which found two Russian crew members presented by her captain as “security agents” on board.  Upon the ship’s release, it went on to the port of Vadinar in western India, home to an offshore oil terminal that supplies local refineries, maritime traffic data shows. Elena Giordano contributed reporting to this article.

A week after it began its strikes on Iran, the Trump administration’s efforts to stem the rise in energy prices have yet to turn the tide — and analysts warn the worst of the price shocks may still be to come. The U.S. benchmark oil price eclipsed $90 a barrel on Friday for the first time since 2023, up more than $20 since the war began Saturday and the market’s highest one-week jump in history. The price increase has already started to appear for American consumers, with prices at the gas pump up 32 cents a gallon from a week ago. The unyielding price increases — which analysts attributed to the continued disruption in the Strait of Hormuz, through which 20 percent of the world’s crude passes each day — comes as President Donald Trump is under rising pressure to contain the economic impact of the war on Americans, eight months ahead of the midterms, where affordability issues are top of mind. “Crude WILL go to $200 [a barrel], en route higher, unless traffic through the Strait resumes,” said Rory Johnston, an oil analyst who writes the newsletter Commodity Context, in a post on X. “Not clickbait, but rather brutal physics and necessary economic incentives.” The White House has announced several measures aimed at calming the oil markets this week, including temporarily easing sanctions on India’s purchase of Russian oil and offering naval escorts and political risk insurance to oil and gas tankers traversing the Strait of Hormuz. None of those measures has succeeded, however, as traders boost prices on news of disruptions to supply. Iran has succeeded in damaging several oil tankers, Iraq and Kuwait have already throttled oil production because their crude tankers can no longer get to market, and China has warned it could stop exporting fuel amid supply concerns. The longer that ships avoid the Strait of Hormuz, Gulf countries will start to run out of storage capacity and be forced to shut in their production, said Claudio Galimberti, chief economist at research firm Rystad Energy. “If the Strait of Hormuz remains closed for, let’s say, three weeks, then you will have shut in 15 million barrels a day of production in the Middle East,” Galimberti said at a Rystad conference in Washington on Thursday. “That takes us from a position of comfortable oversupply as of [last] Friday to one of incredible deficit, the size of which we’ve never seen.” Galimberti noted that oil may be slow to flow even if shipping traffic resumes, given the difficult and expensive processes required to restart production. “If it’s shut for weeks or months, then it’s going to take weeks and probably months to bring it back to the same level,” he said. Still, the administration has said it sees little cause for long-term alarm. Energy Secretary Chris Wright said Friday morning that Americans should expect gas prices to come down again soon. “It’s weeks, I would say, in the worst case,” Wright told Fox News. “It’s weeks, not months.” Wright acknowledged that prices are “more than we’d like them to be,” but noted they remain far lower than the record levels hit after Russia’s invasion of Ukraine during the Biden administration, when global crude supplies were much tighter. White House press secretary Karoline Leavitt said in a statement that record U.S. oil production, new supplies from Venezuela and efforts to reopen the Strait of Hormuz will keep a lid on prices. “President Trump’s entire energy team, from the White House to the National Energy Dominance Council to Secretaries Wright and Bessent, have a game plan to keep oil prices stable throughout Operation Epic Fury,” Leavitt said. Market analysts are painting a much more dire picture of the situation, however. Six days into the conflict, oil and gas tankers remain largely unwilling to transit the strait, cutting off a key supply route between major oil producers in the Gulf and their customers in Asia and beyond. Even with the price increases this week, markets may not be pricing in the true impact of an extended closure of the strait, said Andon Pavlov, director of oil and tanker research at commodity tracking firm Kpler. “There is a widespread expectation across the market that the alternative of not opening the Strait of Hormuz is just so apocalyptically bad that eventually something will happen,” he said in a Thursday webinar. “Is it going to happen? Every day makes it less and less likely.” Even if the Trump administration can get the price of oil under control, that does not guarantee that the price of gasoline comes down with it, said Catherine Wolfram, a former deputy assistant secretary for climate and energy economics at the Treasury Department. “Economists talk about what’s called rockets and feathers — that gas prices go up like rockets when oil prices go up, but then if oil prices go back down … they go back down like feathers,” said Wolfram, who is now a professor of energy economics at the MIT Sloan School of Management. “Especially if you’re coming into the period when [gas prices] tend to rise because of summer driving, they might just stay high, even if oil prices go back down,” she said. The Development Finance Corporation announced new details Friday on the insurance program aimed at getting tankers moving again, which it said would cover losses up to $20 billion. “We are confident that our reinsurance plan will get oil, gasoline, LNG, jet fuel, and fertilizer through the Strait of Hormuz and flowing again to the world,” DFC CEO Ben Black said in a statement. Ben Cahill, an oil analyst and nonresident fellow at Arab Gulf States Institute, said the insurance backstop does not alleviate the fear of being attacked by Iranians, who are “obviously desperate and backed into a corner.” “The measures taken could alleviate some of the risks and maybe drive down some of the costs associated with shipping insurance, but the fundamental problem is still there,” he said. In order to get shipping moving again, “you need a fundamental change in the trajectory of the conflict,” Cahill added. Wright acknowledged in an interview with ABC News on Thursday night that shipping companies have not been willing to transit the strait even with U.S.-backed insurance. “Right now, the biggest issue is just physical security,” he said. “You don’t want to run a large tanker ship through the Strait of Hormuz today, but that’ll change in the not too distant future.” Wright said the U.S. military would begin providing escorts to oil tankers “as quickly as we can,” but its immediate focus was on suppressing Iranian attacks. “First we’ve got to get their ability to cause trouble way down, and then as soon as it’s reasonable to do it, we’ll escort ships through the straits and get the energy moving again,” he said.

Hungarian Prime Minister Viktor Orbán is seizing on fears of an energy price shock from the Iran war to try to claw back ground against his challenger Péter Magyar ahead of an April 12 election. About 10 percentage points behind in the polls, Orbán is now putting energy costs at the heart of the election race. He accuses Magyar’s Tisza party of conspiring with the EU and Ukraine to cut Hungary off from cheap Russian oil, arguing those flows could have cushioned Budapest from the spiraling crude costs triggered by the war on Iran. Sensing an electoral advantage in a showdown with Brussels, Orbán last month vetoed the EU’s all-important €90 billion funding line for Kyiv, accusing the Ukrainians of slow-walking repairs to the Druzhba pipeline that carries discounted Russian oil across Ukraine to Hungary. On Jan. 27 the pipeline was blown up in a drone attack, Kyiv reported at the time. That ruptured pipeline has now become even more politically sensitive thanks to the supply crisis in the Persian Gulf. Orbán is a close ally of Donald Trump, and the Iran war is a rare point of dissonance between him and the U.S. president. Still, the main target of Orbán’s attacks is not Washington but the domestic opposition, which he claims put Hungary in a vulnerable position by siding with the EU and Ukraine rather than fighting to preserve Russian oil supplies. Orbán and his ruling Fidesz party are also playing up alleged security threats from the war in the Middle East — raising the country’s terror level. ORBÁN PLAYS THE ENERGY CARD “Developments involving Iran may have an indirect impact on Hungary’s security, with particular regard to our energy security,” Orbán said on Sunday. “Due to the conflict, significant energy price increases are expected on global markets. In this situation, it is crucial that we break President [Volodymyr] Zelenskyy’s oil blockade against Hungary.” Orbán accuses Péter Magyar’s Tisza party of conspiring with the EU and Ukraine to cut Hungary off from cheap Russian oil. | Bálint Szentgallay/NurPhoto via Getty Images The Hungarian prime minister’s political director, Balázs Orbán, on Monday pushed to make the link to Magyar, accusing him of “acting against the Hungarian people” by teaming up with Brussels and Kyiv on oil supplies. “[Magyar] dismissed the government’s warnings about the Ukrainian oil blockade as fearmongering and panic-mongering, claiming there is no danger and no war, while at the same time openly campaigning for Hungary’s detachment from Russian energy — the very core of the Brussels- and Kyiv-backed program he represents,” he said. “Hungarians are not naïve. They can clearly see that, given the global instability and the escalating Middle East conflict, advocating for decoupling from Russian oil and accepting Ukrainian blackmail would be madness,” Balázs Orbán added. Members of the Hungarian government have posted satellite imaginary claiming Kyiv lied about the pipeline’s not being operational, and have demanded Zelenskyy immediately resume oil deliveries. Foreign Minister Péter Szijjártó accused Zelenskyy of “not telling the truth,” claiming that “at a time when maritime oil transport is uncertain due to the closure of the Strait of Hormuz, blocking a functioning land supply route is a direct attack against Hungary.” The Hungarian prime minister’s political director, Balázs Orbán, on Monday pushed to make the link to Magyar, accusing him of “acting against the Hungarian people.” | Attila Kisbenedek/AFP via Getty Images Hungary also raised the matter on Sunday when EU ambassadors met for crisis talks on the situation in Iran. Budapest’s top envoy, Bálint Ódor, used his intervention to accuse Kyiv of “weaponizing the pipeline” to interfere in Hungary’s elections, according to a diplomat who was present. MAGYAR’S REPLY Magyar has built his lead over Orbán by focusing on the government’s cronyism and economic mismanagement, and has been keen not to be cast as an ally of the EU and Kyiv. His Tisza party’s program does indeed vow to halt Russian energy supplies, by only by the distant date of 2035. Indeed, far from fighting the Fidesz government’s claims over the pipeline, he issued a letter on Monday proposing a joint on-site inspection of Druzhba. “The Hungarian people rightly expect their responsible leaders to make decisions based on facts and in a transparent manner, and not via messages on Facebook and in propaganda,” the letter read. Magyar has also insisted that if the Ukrainian threat to Hungary’s energy infrastructure is as serious as Orbán claims, he should trigger NATO’s Article 4, which allows member states to consult with their allies if they believe their territorial integrity or security is under threat. Geoffrey Smith and Jamie Dettmer contributed reporting to this article

BRUSSELS — Qatar’s huge state-owned gas company halted production of liquefied natural gas on Monday in the wake of Iranian attacks on key energy infrastructure, sending gas prices skyrocketing and compounding fears of an energy crisis. QatarEnergy accounts for nearly 20 percent of the global LNG trade, and is the fourth largest supplier of LNG to the EU, accounting for 6 percent of the bloc’s total intake. The benchmark LNG price in Europe soared as much as 25 percent after QatarEnergy announced it had “ceased production of … LNG and associated products” following military attacks on operating facilities in Ras Laffan Industrial City and Mesaieed Industrial City. A prolonged closure of the massive plant in the Persian Gulf would have a major impact on global supply of the fossil fuel used in electricity generation, heating buildings and powering industry. It follows U.S. and Israeli attacks on Iran which began over the weekend. EU member countries were already jittery about the prospect of airstrikes on energy facilities in the Strait of Hormuz, a key chokepoint for seaborne shipments of oil and liquefied natural gas from Gulf states. All Qatari LNG passes through the Strait of Hormuz. EU countries already kicked off 2026 with lower gas reserves than in recent years, with 46 billion cubic metres at the end of February 2026, down from 60 billion cubic meters in 2025, according to Bruegel.

Crude oil prices leaped and the euro slumped against the U.S. dollar on Monday morning as the world’s financial markets reacted to the prospect of an extended conflict around the Middle East. In early trading in Europe, the benchmark Brent crude futures contract rose nearly 10 percent to a 13-month high of just under $80 a barrel, while benchmark natural gas futures leaped by 25 percent. That reflects fears that the conflict between Iran and the U.S. and Israel may effectively close the Persian Gulf to shipping, choking off some 20 percent of the world’s oil supplies and a similar share of the global trade in liquefied natural gas. An extended jump in world energy prices could have drastic consequences for Europe, a huge net importer of oil and gas, squeezing costs for businesses and households and having a chilling effect on both investment and consumption. That in turn could lead to demands for a fresh round of expensive energy subsidies from EU governments that are still grappling with the after-effects of the last such spike four years ago, when Russia invaded Ukraine. While the rise in energy prices might push inflation higher, the European Central Bank has signaled it wouldn’t automatically respond to that by raising interest rates. Iran’s foreign minister said at the weekend that it was not seeking to close the Straits of Hormuz, the chokepoint at the mouth of the Persian Gulf. But Reuters reported Iran’s Revolutionary Guard as ordering the opposite, and Iranian forces also attacked three tankers. That has been enough to stop most ships from trying to enter or leave the Gulf. The oil market “is the main market to watch, today and for the duration of this episode,” a Deutsche Bank strategist, Jim Reid, wrote in a morning note. “How firmly, or officially closed, the Strait of Hormuz remains will probably play a big part in this.”  Reid noted that markets had gone into the weekend calculating that the looming midterm elections would limit the U.S. administration’s appetite for an extended conflict. Such assumptions may have to be revised if the Iranian leadership continues the struggle, as it vowed it would at the weekend. The eruption of war had impacts far beyond energy markets. The euro and the pound fell over a cent against the dollar, an unusually large move. Meanwhile, EU government bond yields rose and European stocks all fell sharply, with notable exceptions among energy companies, miners and defense contractors. Conspicuously, Russian markets fared less badly than many, with the ruble nearly holding its own against the dollar. The jump in oil prices means that the Kremlin will receive more for its key export, improving its ability to continue its war in Ukraine.

BRUSSELS — Italy is pushing to suspend the European Union’s most important climate policy until it undergoes a “deep revision,” arguing the carbon market has become a burden on European industry. The move is an extraordinary attack on the EU Emissions Trading System (ETS) and suggests the consensus that has made the bloc among the world’s most climate-friendly jurisdictions is fraying. Other countries have also signaled waning support for the carbon price in recent weeks, but Italy’s position is the biggest assault yet from one of Europe’s biggest economies. Speaking at the Competitiveness Council in Brussels on Thursday, Minister for Enterprises Adolfo Urso said the ETS, “as currently designed, represents an additional tax on European companies,” raising costs and undermining competitiveness. Rome, he said, will formally ask the European Commission to pause the system until changes are made to emissions benchmarks and allowance allocation rules, including delaying the phase-out of free allowances. Urso also called for the introduction of a stable support mechanism for exporting companies, arguing that this element was not fully defined in the recent reform of the Carbon Border Adjustment Mechanism (CBAM). He stressed that the ETS and CBAM must be aligned and geared toward protecting Europe’s industrial base. “Chemicals, the industry of industries, is under pressure from high energy costs,” he said, warning that the ETS in its current form is “ineffective and harmful” because it erodes margins without providing sufficient safeguards against competitive distortions.  “We need clear rules and reliable monitoring tools to prevent distortions along value chains. CBAM and ETS must become instruments that support industry, not factors that weaken its competitiveness,” he added.