Europe spent much of 2022 and 2023 urgently building resilience against future energy supply shocks — diversifying import sources, filling gas storage facilities, signing new LNG supply agreements, and reducing dependence on any single supplier. Monday’s crisis has exposed both the progress made and the limits of what was achieved, as surging prices demonstrated that European energy security remains vulnerable to external disruptions of sufficient scale.
The steps taken since 2022 were genuinely significant. European gas storage levels have been maintained at higher levels than in previous years. New LNG import terminal capacity has been added, particularly in Germany. Long-term supply agreements have been diversified across multiple suppliers and regions. These measures have reduced, though not eliminated, the acute vulnerability that became apparent during the 2022 crisis.
However, the current crisis illustrates the limits of diversification when a single supply disruption is sufficiently large. The shutdown of Qatar’s LNG production — potentially removing nearly 20% of global LNG supply — is too large to be easily offset by the additional flexibility that Europe has built since 2022. Gas prices surged 41% on Monday, suggesting that European markets, despite their improved resilience, remain highly sensitive to major disruptions in global LNG supply.
The Strait of Hormuz closure adds another dimension to the challenge. Even if Europe itself does not import large volumes of Middle Eastern oil directly, the closure of the strait affects global oil markets and raises prices for all buyers. Moreover, the redirection of shipping through longer alternative routes adds costs and delays that affect the entire global supply chain, including European imports of goods and commodities beyond energy.
European policymakers face the challenge of managing the immediate consequences of the crisis while drawing the right longer-term lessons. The current disruption provides additional evidence for the case that only a fundamental transformation of the European energy system — toward domestically produced renewable energy, greater energy efficiency, and reduced fossil fuel dependence — can provide the security that emergency measures and supply diversification alone cannot deliver.