Aletho News

Europe, US face higher heating bills amid Iran war fallout

Al Mayadeen| November 11, 2026

Europe is paying a heavy price for the US war on Iran. Natural gas prices have risen almost 200% since February and topped €100 per megawatt-hour at the end of October, the highest level in four years.

The European Commission estimates the continent’s energy import bill has grown by more than €127 billion since the war began, and gas storage is running well below normal ahead of winter, with Germany’s stocks possibly running empty by March.

Bloomberg reported that diesel prices have hit a record, kerosene has nearly doubled, and German power prices already exceed even the 2022 average for the start of winter. The effective closure of the Strait of Hormuz has exposed how dependent the continent remains on global energy markets, leaving governments, industries, and households in their second major energy crisis in under five years.

Storage falls short before winter

Gas storage stands at about 15 percentage points below its recent average and far from the EU’s 90% target.

Under a scenario developed by the European Network of Transmission System Operators for Gas, a cold winter combined with tight global LNG supplies would leave stocks barely 10% full by the end of winter. Even then, Europe would need to cut energy demand by 15%.

Weather models point to a mostly mild winter, helped by a potentially record El Niño, but the British forecaster MetDesk warned that a disrupted polar vortex could bring a colder spell to northern Europe in December. Cold in Asia would also intensify competition for LNG cargoes and push prices higher.

The pressure would not end with winter. The International Energy Agency cautioned that refilling record-low reserves next summer could keep markets tight well into next year, and contracts for summer 2027 already trade above those for the following winter.

Russian LNG ban, a shifting dependency

A full EU ban on Russian LNG takes effect on January 1 and will remove around 15% of the bloc’s supplies, roughly one cargo every two days according to Bloomberg’s calculations. Energy Commissioner Dan Jorgensen insisted the ban stands, leaving member states to buy replacement cargoes on international markets at a premium.

Much of that replacement comes from the United States, and Swedish Energy Minister Ebba Busch said Europe is “just switching our dependency.”

US President Donald Trump threatened earlier this year to ban diesel exports, which would have endangered half of Europe’s imports, and any deal to reopen Hormuz would take up to six months to feed through to European diesel prices.

Governments struggle to cushion the blow

EU governments have more than tripled their emergency spending since June to nearly €35 billion, according to the Bruegel think tank, with Spain accounting for a third. Bruegel said much of the support is poorly targeted and even encourages fossil fuel consumption.

France, after spending an estimated €70 billion after the 2022 shock, is now limiting aid to those in greatest need, a shift Budget Minister David Amiel described as cutting spending instead of raising it.

Italy, which imports about three-quarters of its energy, saw inflation reach 5.6% in October. Truckers blocked roads around Naples and the Messina port for five days until Rome allocated over €100 million in diesel tax credits and about €70 million for agriculture and fisheries.

Rome is also negotiating with the Commission to cap the gas price used in power generation, and it clashed with Berlin over Germany’s slow storage filling, which it said drove panic buying.

Poland, where a fifth of this year’s budget goes to defense, has little room to respond. State Secretary for Energy Wojciech Wrochna said Europe is not doing enough and warned the situation leaves “space for populists to win the elections.”

The Commission has pushed responsibility back to national capitals, unlike in 2022 when Brussels rushed through emergency legislation.

Politics, industry feel the strain

Protests over living costs have spread from Berlin to Milan and Paris. More than half of Europeans are set to vote within the next year.

In France, where presidential elections come in April, National Rally leader Marine Le Pen leads first-round polls and proposes cutting VAT on fuel and energy at a cost her party puts near €11 billion. Far-left candidate Jean-Luc Mélenchon calls for price caps and limits on refiners’ margins.

The chemical industry warns of lasting damage. Norwegian chemical company Yara International expects its energy costs to rise by $450 million year on year between October and December if gas prices stay high, and Greece’s Metlen Energy & Metals said further closures are hard to rule out without looser state aid rules.

Kahla Porzellan, a Thuringian porcelain maker that survived both world wars, will shut down by the end of the year and lay off 100 workers. Monthly gas bills reached as much as €180,000, or 70% of operating costs.

US households also face higher bills

American households face the strain too, with home heating costs projected to rise more than 7% on average this winter, The New York Times reported, citing the National Energy Assistance Directors Association.

Households that heat with oil, almost five million nationwide and mostly in the Northeast and Alaska, could pay up to 70% more than last winter, or about $2,977 for the season. Electric heating is set to climb about 6% to $1,215, and propane about 5% to $1,350.

The association’s executive director, Mark Wolfe, said uncertainty over global oil supplies makes prices hard to predict and urged states to prepare for them to stay high. Heating oil is close to diesel, whose supplies have tightened after refinery shutdowns in West Asia.

Data from the Energy Information Administration in April showed that as many as one in six US households had fallen behind on gas and electricity bills.

November 11, 2026 - Posted by aletho | Economics, Russophobia, Wars for Israel | European Union, United States