Countries roll out emergency measures as iran war fuels energy crisis

Tuesday 21 April 2026 - 15:00

By: Dakir Madiha

Countries roll out emergency measures as iran war fuels energy crisis

Governments across dozens of countries are deploying emergency policies to shield households and businesses from a widening energy crisis triggered by the war involving the United States, Israel, and Iran. The disruption has been amplified by the closure of the Strait of Hormuz, which has removed roughly one fifth of global oil and liquefied natural gas supply since late February, driving sharp increases in fuel and electricity costs worldwide.

Authorities have introduced a broad mix of interventions, including fuel subsidies, tax cuts, price caps, and the release of strategic reserves. In Europe, the European Commission has moved to ease state aid rules, allowing member states to offset rising costs for fuel and fertilizers. Germany, Italy, and Poland have implemented fuel price caps and tax reductions, while Sweden has lowered fuel taxes and expanded electricity subsidies as part of a spring budget package. The Netherlands has committed more than 950 million euros to cushion economic impacts, and Greece has approved 300 million euros in subsidies covering fuel, fertilizers, and ferry transport. Spain is preparing to vote on similar measures targeting energy and electricity costs.

Asian economies have also intensified support efforts. South Korea approved a supplementary budget of 26.2 trillion won, equivalent to about 17.6 billion dollars, to ease energy cost pressures while delaying coal plant closures and restarting nuclear facilities. Malaysia’s fuel subsidy bill surged to an estimated 7 billion ringgit in April alone, around ten times prewar levels, with gasoline prices capped at 1.99 ringgit per liter. In Hong Kong, authorities introduced a diesel subsidy for commercial transport and cut tunnel tolls by half, with the program expected to cost 1.8 billion Hong Kong dollars over two months.

China has taken a more inward approach by restricting exports of refined fuel to secure domestic supply. Refiners have been ordered to cancel export contracts and halt shipments that have not yet cleared customs. As a result, March fuel exports to markets such as Singapore, Malaysia, and Australia dropped by 20 percent مقارنة مع فبراير. At the same time, Beijing is accelerating long delayed coal to gas projects to reinforce energy security, including the resumption of a gasification plant in Fuxin scheduled for completion later this year.

In the United Kingdom, households are bracing for higher energy bills as regulators prepare to adjust the national price cap. Estimates suggest an increase of up to 18 percent from July, with projected annual costs rising from 1,641 pounds to between 1,861 and 1,972 pounds. The regulator is expected to confirm the new cap by late May, with analysts warning that higher costs are difficult to avoid given sustained pressure on global energy markets.

The scale and diversity of responses underline the global reach of the crisis and the strain on public finances. While emergency measures provide short term relief, policymakers face growing challenges in balancing fiscal stability with the need to protect consumers. The trajectory of the conflict and any reopening of key energy routes will be decisive in determining whether current interventions can stabilize markets or require further escalation.