Europe is racing to soften the economic blow from the Iran crisis as wild swings in oil prices raise fears that a market shock could hit growth, inflation and household budgets. Speaking to TVP World’s News in Depth program, Jakub Kapiszewski, the channel's business editor, said governments across the continent were already moving to shield consumers and businesses from higher energy costs, even as uncertainty over the Strait of Hormuz continues to roil markets. “Oil is trading at around $110 per barrel,” Kapiszewski said, noting that prices had briefly hit $120 earlier in the week. “There is huge volatility. The market reacts to minuscule tidbits of information.” That volatility reflects mounting concern over supply routes and the risk of further strikes on Gulf energy infrastructure. Kapiszewski pointed to forecasts suggesting that if the conflict does not ease, prices could climb much further. “If the conflict doesn’t abate until the end of April, we may be looking at oil trading at $185,” he said, while adding that some analysts see even $200 a barrel as possible. Europe reaches for quick relief Across the EU, governments have begun reaching for emergency tools to blunt the impact of rising fuel and electricity costs. The European Commission this week said member states should consider tax cuts and subsidies to cushion the shock, while Spain approved a €5 billion support package that includes lower electricity taxes and fuel relief. Kapiszewski said the danger would become more serious if crude climbed toward $135 a barrel, a level some analysts see as recession territory. Even so, he argued that Europe is not facing a one-dimensional crisis. “It’s just not as simple as whether tankers are passing the Strait of Hormuz or not,” he said, pointing to the various support measures governments have already deployed. Poland stays cautious Poland, by contrast, has so far avoided broad administrative intervention. Kapiszewski said this was partly because Warsaw has less fiscal room than some other capitals, but also because Poland is better insulated than many countries thanks to earlier diversification of energy supplies. He noted that about half of Poland’s natural gas comes from Norway and that most LNG imports come from the US, limiting direct exposure to the Gulf route. On oil, Saudi Arabia has replaced Russia as a key supplier, although energy giant Orlen has been affected by regional reserve measures, including the release of stocks in Lithuania. The message from Warsaw, Kapiszewski said, remains one of caution rather than panic, adding that Poland still has strategic reserves and some room to maneuver before having to act.
