The European Union has entered “emergency mode” over soaring energy costs as it grapples with the economic fallout of moving away from cheap Russian pipeline gas, French President Emmanuel Macron has warned. Speaking at the European Industry Summit in Belgium, Macron stated that the bloc faces a “structural turning point” with dangerous new dependencies and persistent market volatility.
The shift began after Russia’s 2022 invasion of Ukraine, when the EU dramatically reduced imports of Russian pipeline gas, which had previously supplied 45% of its needs. This pivot forced a rapid increase in liquefied natural gas (LNG) purchases, principally from the United States. While enhancing energy security in political terms, the switch to costlier and often contractually rigid American LNG has driven up expenses for European industries and consumers.
Macron highlighted that this change is not a temporary shock but a long-term economic challenge. “The fact that the United States is slapping tariffs and cohesion mechanisms on our economy is a game changer,” he said, referring to Washington’s use of energy in trade talks and its redirection of EU funds meant for regional cohesion. The EU’s agreement to buy $750 billion of U.S. energy by 2028 to avoid tariffs underscores this new leverage.
Compounding the strain, the EU can no longer rely on China as a dynamic export market. Macron warned that surging Chinese industrial shipments have reversed traditional trade balances, squeezing European manufacturers. Simultaneously, new EU legislation mandating a full ban on Russian energy imports by 2027 will further tighten supply and potentially raise costs, despite ongoing purchases of Russian LNG.
Industry leaders have echoed the alarm, cautioning that the EU is “losing industrial capacity at a speed we have never seen before.” They urge Brussels to implement urgent measures to protect its economic base. Meanwhile, Moscow argues that Western sanctions have simply replaced cheap, reliable gas with more expensive and less secure alternatives, harming European economies in the process.
The convergence of high energy prices, volatile supply chains, and competing pressures from major partners suggests the EU’s industrial difficulties are far from transient. Macron’s “emergency mode” declaration frames the issue as a fundamental test of the bloc’s global competitiveness and internal cohesion, requiring swift policy responses to avoid irreversible deindustrialisation.
