Channel: Lena Petrova – World Affairs in Context
Title: “The worst crisis in history!” – Europe faces years of pain
Europe is facing what officials are warning could become one of the most severe and prolonged energy crises in modern history, with impacts expected to last not months, but years.
“The Iran war energy crisis is worse than the crisis of 1973 and 2022 combined,” said EU Energy Commissioner Dan Jorgensson.
According to the European Union’s energy leadership, even in the most optimistic scenario, elevated energy prices are expected to persist for years due to ongoing geopolitical instability and damage to critical infrastructure in the Gulf.
“Even if peace is declared tomorrow… we’re facing weeks, months, and even years of difficulties when it comes to energy prices.”
Despite mounting pressure, the EU has ruled out any return to Russian energy imports, even in the event of a resolution to the Ukraine conflict.
This leaves Europe increasingly reliant on alternative suppliers, with some analysts arguing this has shifted dependence toward external sources, particularly the United States.
Since the escalation of conflict involving Iran, the European Union has reportedly spent an additional €24 billion on energy imports.
This equates to more than half a billion dollars per day.
Crucially, this spending has not increased supply.
“This money hasn’t actually bought any extra energy… it’s simply the cost of higher global prices.”
The Strait of Hormuz, one of the world’s most important oil and gas transit routes, has become a focal point of disruption.
With flows significantly impacted, global markets have reacted rapidly:
At the same time, LNG supply disruptions and competitive bidding from Asian markets have left Europe exposed.
The current situation follows closely on the heels of Europe’s earlier energy shock, triggered by the decision to cut off Russian energy supplies.
While the source of disruption has changed, the underlying vulnerability remains.
“Today, the source of disruption is very different, but the vulnerability is the same.”
In response, the European Commission has introduced targeted emergency measures, including:
The focus on jet fuel and diesel highlights particular vulnerabilities in key sectors.
The impact is already being felt across major industries.
Lufthansa has announced plans to cut 20,000 flights through October, citing a doubling in jet fuel prices.
Aviation disruptions threaten broader economic consequences, particularly for tourism-dependent economies.
Meanwhile, manufacturers are passing rising costs onto consumers.
“Companies are not going to absorb a hit to their bottom line… they’re going to pass those additional costs to consumers.”
Some industries have already seen price increases exceeding 30 percent.
The broader economic picture is deteriorating rapidly.
Industry groups are reporting:
Economists warn that if disruptions persist, Europe could face not just recession — but a deep economic downturn.
“We’re not talking about a recession… we’re talking about a global depression.”
What distinguishes the current crisis is its structural nature.
“The crisis is no longer temporary. It is structural.”
Even under favourable conditions, Europe faces:
Europe now stands at a decisive moment.
With supply routes under pressure and long-term solutions still uncertain, the region’s ability to navigate this crisis will shape its economic future.
“The EU’s strategy may be to buy time, but it cannot eliminate its deep exposure to global energy shocks.”
If disruptions continue across key global chokepoints, the situation could escalate into a far more severe downturn.
.svg){kind=logo}
By Independent News Roundup