Europe is not facing an immediate fuel supply crisis despite renewed tensions in the Middle East, but the continent remains dangerously exposed to fossil fuel price volatility and must accelerate electrification while resisting any return to Russian energy, according to EU Energy Commissioner Dan Jørgensen and International Energy Agency (IEA) chief Fatih Birol.
Speaking to Euronews, both leaders stressed that a ceasefire in the Middle East should not lull Europe into complacency. Disruption to the Strait of Hormuz could send oil prices soaring and reignite inflation, they warned. “We are in a very serious situation. I'm not telling people, companies, businesses or decision-makers not to be worried. There is, unfortunately, reason to be worried. But we can act and we will act,” Jørgensen said.
Birol added that if the critical chokepoint closes again, oil prices may rise with “significant implications for the economies.” He noted that the uncertainties stem from geopolitics, not the energy sector itself. Recent hostilities have rattled energy markets and left maritime confidence fragile.
No Return to Russian Energy
Both officials firmly ruled out reopening imports of Russian energy to Europe, describing such a move as repeating one of the continent's “biggest strategic mistakes.” Instead, they argued that Europe's long-term solution lies in a programme of rapid electrification: expanding renewable and nuclear power, investing in electricity grids, electric vehicles, heat pumps, and making electricity cheaper than fossil fuels.
This approach would address industry demands for lower electricity bills while accelerating efforts to electrify transport, heating, and industry, and removing fiscal incentives that perpetuate fossil fuel reliance. “We should make the electricity prices affordable for the people, so that the consumers, households and industry can go for a cheaper option. They will not go for electricity because it is clean. They would go for electric because it's cheap,” Birol said.
Jørgensen hinted at the European Commission's upcoming electrification strategy, a draft of which Euronews has seen. Expected to be unveiled on 17 July, it aims to set an electrification target for 2040, arguing that widespread adoption of electric technologies could save roughly €200 billion in fossil fuel imports by that year, while cutting demand and greenhouse gas emissions. This strategy is central to achieving energy sovereignty, a goal many European CEOs argue is essential for the continent's strategic independence.
Grid Bottlenecks and Investment Gaps
For the EU's electrification plan to succeed, officials are pushing for faster grid investment, lower transmission costs, and incentives to accelerate the costly transition, which the European Commission estimates at €1.2 trillion. “European leaders and the finance ministers need to overcome issues in order to give incentives,” Jørgensen said, conceding that EU funds allocated to revamp grids alone are insufficient. “If we leave everything to the markets, it will not happen.”
Without a modernised grid, the increasing volumes of clean power produced in the EU cannot be transported, presenting a major hurdle to the bloc's climate, energy, and industrial ambitions. “We should intervene. We should give incentives, price incentives and subsidies in different cases in order to incentivise,” the commissioner added.
Jørgensen dismissed potential clashes among EU countries over funding for new power lines, even though Sweden has been vocal on the matter at previous energy minister meetings. “Of course, there are differences between some countries. Some are focusing on nuclear, some are focusing more on renewables, some are focusing on both. But electrification that we are talking about today is necessary both for nuclear and for renewables,” he said.
The controversy centres not on energy mix, but on infrastructure costs. Portugal recently urged the Commission to recognise it as an “energy island” so it might be eligible for more EU funds, alongside Spain. The Iberian Peninsula faces historic isolation from the rest of Europe due to a lack of interconnectors with France, which fears that massive power grid investments won't ultimately bring national benefits. This issue is highlighted in Portugal's demand for EU compensation over its energy island status.
Meanwhile, German households are increasingly turning to battery storage to escape fossil fuel price volatility, a trend that underscores the growing grassroots push for energy independence. As Birol noted, making electricity the cheaper option is key to driving consumer adoption. “They will not go for electricity because it is clean. They would go for electric because it's cheap.”
