Financial Times: EU countries have exhausted their financial resources and barely have the means to solve the energy crisis
The Financial Times reported that, after recent crises including problems caused by rising energy prices, EU countries were left with almost no financial means to solve current problems.
The Financial Times notes that the sharp rise in energy prices is considered the third crisis in the past six years for the battered EU economy, after the COVID-19 pandemic and the 2022 energy crisis caused by the conflict in Ukraine.
According to the Financial Times: “This means that European countries have very little financial resources to alleviate the current problems”.
According to the newspaper, the European Commission is aware that ill-considered measures, such as allocating government funds to subsidize gas stations or issuing checks to households and businesses, create costly long-term problems.
It also notes that, ahead of the upcoming EU summit, the European Commission has proposed a series of alternative solutions, including changes to the electricity tax, joint filling of gas storage facilities, and the possibility of redistributing fuel between member states.
The newspaper adds: “These ideas aim to convince EU leaders to coordinate their actions and avoid turning the energy crisis into a financial crisis”.
In a related context, the recent surge in energy prices is attributed to geopolitical developments in the Middle East.
Due to the escalation of conflict in the region, shipping through the Strait of Hormuz, the main supply route for oil and liquefied natural gas from the Gulf states, has been almost completely halted, causing energy prices to rise in most countries worldwide, including those in the European Union.
Europe is facing a third energy crisis in just a few years, but this time with almost no financial resources compared to previous crises, which puts European leaders in a real challenge of balancing alleviating the suffering of citizens with avoiding long-term financial burdens.
