US-Israel Attacks on Iran Drive European Electricity Prices Higher

Wholesale electricity prices across Europe have risen following energy supply disruptions caused by attacks on Iran by the United States and Israel on February 28, 2026. Gas-dependent nations experienced the most significant impact, with benchmark contracts increasing by over 20% in Italy and 15% in Germany. To mitigate the economic fallout, the European Commission developed plans to reduce electricity taxes.

Certain countries remained more insulated from the price spikes due to their energy profiles. Albania leveraged its hydroelectric power, which provides over 90% of its electricity, to keep prices lower. France, Poland, and Serbia also saw muted impacts due to their reliance on nuclear energy and coal production. Conversely, Greece delayed the closure of coal plants to manage the crisis.

The energy instability has increased global inflationary pressure and raised the risk of a worldwide recession. Amidst the crisis, Donald Trump criticized Europe's green energy transition, claiming it lacks sufficient urgency.