EU considers energy demand cuts as Middle East conflict escalates

European Union energy ministers will consider reducing energy consumption when they meet on 29 October, Euronews reported. A document seen by the news outlet shows that EU governments could ask households and businesses to cut energy use if the Strait of Hormuz remains closed in the coming months. Ireland, which currently holds the rotating presidency of the Council of the EU, put forward the proposal. [1]

The energy-saving proposals follow escalating disruptions to Middle East energy shipments. CNBC reported that Iran's Revolutionary Guards said naval mines stopped three tankers attempting to pass through the Strait of Hormuz. Attacks on commercial shipping and strikes against Saudi Arabian energy facilities have intensified in recent weeks, according to CNBC. [2][4]

The conflict has pushed crude oil prices higher. CNBC and irishtimes.com both reported that Brent crude futures gained on Wednesday, with CNBC reporting a price of $109.73 a barrel and irishtimes.com citing $110.38 per barrel. The outlets also reported that U.S. West Texas Intermediate crude rose, reaching $98.58 a barrel according to CNBC and $99.18 per barrel according to irishtimes.com. The New York Post reported that crude oil prices reached a five-month high before reversing some gains. [2][3][5][6]

As FTMQ News reported earlier, European energy prices have already seen major increases due to conflict in the Middle East. Dutch TTF benchmark gas futures reached €87.20 per megawatt-hour earlier in October, up from approximately €32 before the war in Iran. The Strait of Hormuz typically carries roughly one fifth of the world's liquefied natural gas supplies. [17]