European gas prices surge on Middle East escalation as EU fines AliExpress
Escalating Middle East tensions have driven European gas prices to a four-month high, compounding economic pressures as the EU levies a record fine on AliExpress and a new UK prime minister takes office.
European natural gas prices have reached a four-month high as escalating military strikes in the Middle East raise concerns over winter supply shortages. The Dutch natural gas benchmark briefly exceeded €60 a megawatt hour on Monday, approaching peaks seen at the onset of the US-Iran conflict.
The surge follows an expanded US aerial offensive and retaliatory Iranian strikes on Bahrain and Kuwait. Analysts at Independent Commodity Intelligence Services warn that the conflict is delaying the recovery of Qatari liquefied natural gas exports during a critical summer storage period.
Oil markets are also reacting to regional instability, with Brent crude rising 0.5% to $88.51 a barrel. The Iran-aligned Houthi movement has threatened an immediate maritime embargo against Saudi Arabia, adding to existing restrictions on traffic through the Strait of Hormuz.
In Brussels, the European Commission has imposed a record €550m fine on the online retail platform AliExpress. The penalty is the largest issued under the Digital Services Act, which was introduced in 2024 to protect consumers from illegal goods and deceptive marketing.
Henna Virkkunen, the commission’s executive vice-president for tech sovereignty, condemned the platform's failures. She said: “The spread of counterfeit clothing, unsafe toys, dangerous cosmetics and other illegal and harmful products is not an unavoidable cost of shopping online – it is a failure by AliExpress to comply with its obligations under the Digital Services Act.”
Meanwhile, Andy Burnham has become prime minister of the United Kingdom, inheriting an economy burdened by weak growth, underinvestment and constrained public finances. The Labour leader has pledged to deliver regional growth by transferring power from Westminster to local communities.
Business leaders have responded by demanding immediate action to reduce operating costs. Rain Newton-Smith, chief executive of the Confederation of British Industry, insisted that ambitions for local growth must be matched by policies that tackle the cost of doing business and stimulate investment.
Alan Vallance of the Institute of Chartered Accountants in England and Wales warned against any further business tax increases. Tina McKenzie, policy chair at the Federation of Small Businesses, called for a rework of business rates and an increase in small business rate relief to help firms survive recent national insurance rises.
Labour unions and think tanks are also setting out their priorities for the new administration. Paul Nowak, general secretary of the Trades Union Congress, urged the government to tax bank profits to lower energy bills, while the Institute for Fiscal Studies cautioned that constrained finances will require ruthless prioritisation.
