Hormuz and energy shock: Brussels underestimates supply risks, analyst warns

A prolonged closure of the Strait of Hormuz, triggered by the conflict with Iran following the military campaign launched by the United States and Israel on 28 February, has set off an unprecedented supply-side energy crisis. Europe risks being inadequately prepared, potentially entering into direct competition with Asian countries to secure increasingly expensive resources. This is the view of Francesco Sassi, professor of energy geopolitics at the University of Oslo and author of the blog and newsletter Energy Geopolitics & Statecraft, who spoke to Focus Europe about the global energy outlook and the EU’s vulnerabilities.

In 2023, around 20 million barrels of oil passed daily through the Strait of Hormuz, accounting for roughly one-fifth of global liquid fuel consumption, according to the US Energy Information Administration. Around one-fifth of global liquefied natural gas (LNG) also transited through the strait. With the waterway now blocked due to the war, the International Energy Agency (IEA) forecasts a drop in global oil supply of at least 8 million barrels per day in March. Even the historic decision by its member countries to release 400 million barrels of oil is seen as a temporary measure against a global demand of 104 million barrels per day. On the gas side, the interruption of exports from Qatar — which accounts for about 20% of global LNG supply — is particularly significant.

Despite diversification efforts since the 2022 energy crisis and growth in renewables, the EU energy mix remains heavily dependent on fossil fuels. According to Eurostat data, oil and petroleum products accounted for 38% of the total in 2024, natural gas for 21%, renewables for 20%, nuclear energy for 12%, and solid fuels for 10%, with significant differences across member states.

Europe’s main energy partners are Norway and the United States. However, data from Germany’s Ifo institute suggest that around 6.2% of EU crude oil imports and 8.7% of LNG imports transit through the Strait of Hormuz. This puts EU countries in direct competition with Asian economies, which in 2025 imported around 60% of their oil needs from the region and 27% of their LNG.

A Europe more exposed than in 2022

“Europe is not at all more prepared today than it was in 2022 to face a new energy crisis,” Sassi argues, suggesting that the situation has in fact worsened in terms of energy policy.

According to Sassi, EU energy policy in recent years has revolved around a “macro-objective”: phasing out Russian hydrocarbons — a goal that remains unfulfilled four years after Russia’s invasion of Ukraine. It is precisely around this incomplete objective, he says, that Europe now finds itself “with both hands tied”.

On 26 January, EU countries formally approved regulation to gradually eliminate Russian gas, with LNG imports to be banned by early 2027 and pipeline imports by autumn 2027. In this context, Sassi argues that Brussels and EU countries cannot strengthen their energy security without turning to other global suppliers — yet the current crisis is making that alternative far more costly.

“There is no way to strengthen energy security without looking to other market players,” he says. But since “all Gulf countries were selected as primary alternatives to Russia,” any disruption in supplies from the region makes “the price of this alternative much higher.”

In Sassi’s view, this exposes Europe to direct competition with major Asian economies. “The European economy is competing with China, Japan and India.” The risk, he argues, is that Brussels will realise the severity of the situation too late — “when Asian markets and these countries decide to secure all available volumes of oil and gas, paying a higher price than Europe is currently able to offer.”

In recent days, EU leaders and officials have sought to reassure markets about supply security. Speaking before the European Parliament on 10 March, European Commission President Ursula von der Leyen acknowledged the severe impact of the Middle East crisis on the energy sector but stressed that “Europe is now much less exposed to fossil fuel imports.” A day earlier, Energy Commissioner Dan Jørgensen said that the EU currently does not face “a security of supply problem,” adding that any measures taken should be temporary and targeted.

Sassi also highlights a key difference from the 2022–2023 crisis. That crisis “was generated in Europe, with Europe at the centre. This time, the centre is Asia,” he says. As a result, the impact on European markets is indirect, while “all LNG that can be diverted to Asia is currently going there — unlike in 2022–2023, when it was redirected towards Europe.”

Options on the table and the storage challenge

As for short-term responses, Sassi identifies two main options, while expressing scepticism about the political willingness to pursue them.

“There are two things Europe can do: one internally and one in cooperation with Asian countries,” he explains. The first would involve “a very direct and frank acknowledgment of the gravity of the situation,” accompanied by plans for energy savings ahead of next winter, covering transport, electricity, and household heating.

However, such a move would carry significant political costs for the Commission. “This would be a massive admission of failure,” Sassi argues, “because four years after 2022 it would mean admitting we are facing another crisis and that what has been done so far has not prevented it.”

The second option would be to coordinate with major Asian importers. “The alternative is to engage with Asian countries — China, India and Japan — and find a way to manage this situation in a coordinated manner, outside market rules, injecting a significant degree of political and geopolitical planning into energy flows until next winter,” he says. Yet this scenario also appears unlikely, given the lack of a shared European position on relations with Washington and Beijing, and what he describes as the absence of a “geopolitical energy language” within the European Commission.

Sassi is also critical of renewed discussions around a gas price cap, recently floated by von der Leyen in her 10 March address. He calls the measure “unfeasible” and warns it could send the wrong signal.

“Policymakers are effectively signalling that there is no real problem, by proposing a price cap whose enforcement on global markets remains unclear,” he argues. Instead, priority should be given to “dialogue with other global gas-importing countries.”

On the supply side, room for manoeuvre remains limited. “Outside Qatar, LNG comes from only a handful of countries,” Sassi notes. If Doha’s exports are halted due to a prolonged closure of Hormuz, “the main exporters would be the United States, Australia — and the third would be Russia.”

A key issue for gas remains storage levels and timing. European storage stood at around 30% in early March, compared to a five-year average of around 45% for the same period, partly due to a colder-than-average winter, especially in northern Europe.

“Our storage levels are very low, and we are still in winter,” Sassi warns. “We do not know what will happen this summer, nor how long the conflict will last.” If Europe believes it can “play a slow game” and delay political decisions, it risks “falling out of the game altogether, missing the window of opportunity.” Rebuilding storage, he stresses, requires time, money, and available gas — “which, at the moment, simply isn’t there.”

The original article in Italian by our partner media FocusEurope.it can be found here.

Caption: Unleaded and diesel fuel pumps at a petrol station forecourt in London, Britain, 13 March 2026. Disruptions to oil shipping routes due to the closure of the Strait of Hormuz in the wake of US and Israeli military strikes on Iran and retaliatory attacks by Iran have led to a surge in fuel prices at UK petrol stations. Economists warn that this increase could raise inflation and reduce consumer spending. EPA/TOLGA AKMEN