Hormuz Closure Has Cost Europe $142 Billion for the Same Energy

Europe has paid an extra €127 billion — just over $142 billion — for imported oil and gas since the effective closure of the Strait of Hormuz, and it has received nothing more for the money. European Commission President Ursula von der Leyen disclosed the figure this week in a keynote at the WinWin Brussels Summit.

"Since the closure of the Strait of Hormuz, imported fossil fuels cost Europe an additional €127 billion without a single molecule of energy in addition," von der Leyen said.

The bill has climbed fast. In April, roughly seven weeks into the Iran war, the Commission put the extra cost at €24 billion, about $27 billion. By late September, EU energy commissioner Dan Jørgensen said the figure had passed €100 billion, roughly $111 billion, noting the bloc hadn't received "one extra molecule of gas or oil."

"When we import oil and gas, we risk importing the shocks and crises that come with them," von der Leyen said.

Why was Europe so exposed?

The crisis is the bloc's second fuel shock in four years. After Russia invaded Ukraine in 2022, Moscow cut gas flows to a trickle, governments scrambled to fill storage at record prices, and the EU vowed to quit Russian energy. Russia's share of EU gas imports fell from about 45% before the invasion to about 13% in 2025. In January, member states adopted a ban ending Russian LNG imports by the end of this year and pipeline gas by autumn 2027.

But Europe largely swapped one set of imports for another — much of it LNG shipped from the U.S. and the Middle East. When the Iran war began, the EU still got 57% of its energy from imported fossil fuels.

What did the strait shutdown do?

The Strait of Hormuz carried about one-fifth of the world's traded oil, and the war shut it down. Tanker traffic through the waterway nearly stopped. After a cold winter, EU gas storage stood at just 28.4% in late March, below the five-year average. The Persian Gulf had supplied more than 40% of Europe's jet fuel and diesel imports.

The response got personal fast. Jørgensen asked member states to consider "voluntary demand-saving measures," especially in transport. The International Energy Agency floated a plan to cut oil use that included car-free Sundays — a rationing tactic from the 1970s oil crisis.

By September, drivers in some EU countries paid nearly 50% more at the pump, more than $11 a gallon. In Italy, a weeklong truckers' strike over diesel prices halted milk deliveries to mozzarella makers as Italian inflation hit 5.4%. EU officials expect oil and gas prices to stay above prewar levels until at least the end of 2027.

How bad could this winter get?

The IEA said Tuesday that EU gas storage is entering the heating season at its lowest level since 2013. In a cold winter with continued Hormuz disruptions, storage could fall below 10% by the end of March. EU gas network operators warn of a shortfall of 12% to 15% of demand in a severe cold snap, and energy ministers met in late October to discuss EU-wide limits on consumption.

Russia has offered a way out. Vladimir Putin said in March that Russia was ready to supply Europe again. Von der Leyen called a return to Russian fuel a "strategic blunder."

Is cutting imports the plan?

On Tuesday, she argued Europe's answer is to import less. "This year, we have again seen the devastating impact of climate change. Droughts, wildfires, floods," she said. "But we have also seen the cost of our dependence on imported fossil fuels."

The EU has pledged climate neutrality by 2050 and a 90% emissions cut by 2040. Von der Leyen said more than €1.2 trillion has been invested in sustainable activities across the bloc since 2021.

"So let me be crystal clear: Europe will stay the course, we stick to our targets, and we back our clean industries," she said. With storage at a 13-year low and prices not expected to normalize before the end of 2027, that course faces its hardest winter test yet.