FX.co ★ Costly fossil purchases undermine Europe’s energy security and competitiveness

European countries that are rapidly expanding purchases of conventional hydrocarbons amid global instability risk importing systemic crises and shocks along with the fuel, European Commission President Ursula von der Leyen warned. She said the only sustainable way out for the EU is to speed up the rollout of clean energy—particularly wind and solar generation—which would deliver not only climate security but also independence and improved economic competitiveness for the bloc.

The urgency of completing the green transition has intensified against a widening crisis triggered by major supply disruptions in the Middle East after the Strait of Hormuz was effectively blocked. Limited inventories in Europe’s underground storage forced importers to turn to more expensive supplies from Norway and the United States. As a result, von der Leyen calculates, the EU has incurred an additional €127 billion in oil and gas costs since the start of the year, effectively overpaying for fuel without increasing the physical volume of energy received.

Despite the multibillion bill, EU leaders have reaffirmed their commitment to completely phase out Russian supplies. Von der Leyen stressed that Brussels does not intend to resume purchases of Russian energy and that the goal of eliminating dependence on Russian fuel should be achieved by the end of next year.