EU Proposes Jet Fuel Stockpiles, Energy Tax Cuts Amid Iran War Crisis
The EU proposes jet fuel stockpiles and energy tax cuts to address the Iran war-driven crisis, which Commissioner Dan Jorgensen warns could last years and is comparable to past major crises. The AccelerateEU initiative aims to manage energy prices and shortages while pursuing long-term electrification to reduce fossil fuel dependence. The conflict has already added €24 billion to the EU’s fossil fuel bill.
The European Union has proposed measures, including holding jet fuel stockpiles and cutting energy taxes, to navigate a crisis driven by the Iran war, which it warns could last for years. The AccelerateEU initiative, announced by the European Commission on Wednesday, aims to help member states curb energy prices and address potential fuel shortages without undermining climate goals or causing competition.
EU energy commissioner Dan Jorgensen stated the crisis is "probably as serious as the 1973 and the 2022 crisis combined," and could lead to "very difficult months, or maybe even years." The EU, while less reliant on Middle East energy, remains susceptible to price shocks due to its overall dependence on fossil fuel imports. Since the conflict began, gas has gained 34% and Brent crude 37%.
Next month, the Commission will propose measures to optimize jet fuel distribution among member states, potentially redistributing it based on regional needs. The International Energy Agency estimates the bloc could face serious supply issues within five to six weeks. The EU will also coordinate gas storage filling over the summer.
Longer term, the EU plans to double down on electrifying its economy to reduce fossil fuel dependence, aligning with its goal of cutting emissions by 90% by 2040 compared to 1990 levels. An electrification strategy and legislative proposals will ensure power is taxed less than oil and gas. The Iran war has already increased the EU’s fossil fuel bill by €24 billion.