The Iran war, launched by the U.S. and Israel, has sent global fuel prices soaring and raised concerns over the Strait of Hormuz, prompting European policymakers to seek alternative trade and energy routes. In the first 54 days of the conflict, the European Union spent an additional 25 billion euros, or $29 billion, on oil and gas imports, according to European Commission President Ursula von der Leyen. This surge in costs highlights the direct financial burden imposed on European economies by the conflict, while simultaneously benefiting energy producers.
War for Capital, Costs for Economies
Following the outbreak of the Iran war, Saudi Aramco, the state-owned oil company, immediately ramped up transport through its East-West Pipeline to its maximum capacity of 7 million barrels of oil per day. This move secured continued revenue streams for the oil giant amidst regional instability. European leaders, including von der Leyen and European Council President Antonio Costa, have declared the bloc “ready to team up with Gulf countries” to establish new energy infrastructure designed to circumvent conflict zones like the Strait of Hormuz. This initiative aims to protect the flow of resources essential for European capital.
European Commission President Ursula von der Leyen told G7 leaders at a summit this week that “alternative export routes have been created that are more resilient and offer choices” and that “other routes will be built — for example, a typical one is IMEC.” The India-Middle-East-Europe Economic Corridor (IMEC) is now being actively explored by European policymakers. This project is framed as a means to bolster the European Union's economic resilience, diversify supply chains, and enhance energy security, thereby strengthening the bloc's strategic autonomy.
New Routes for Old Profits
IMEC, which would pass through Israel and has Israeli support, is seen as a “very revolutionary and transformative development” by Israeli Prime Minister Benjamin Netanyahu. U.S. leadership is considered crucial for advancing IMEC, particularly in facilitating the normalization of relations between Israel and Saudi Arabia. Lianne Pollak-David, co-founder of the Israel-based Coalition for Regional Security, stated that “Without normalization between Israel and Saudi Arabia, IMEC cannot be truly realized.” However, Saudi Arabia has conditioned normalization on a clear pathway to Palestinian statehood, a demand Netanyahu opposes, revealing a fundamental political obstacle to capital's desired infrastructure.
The EU has supported IMEC through a memorandum of understanding, though only a minority of its 27 member states are formal signatories. A high-ranking EU diplomat indicated that the current focus is on translating the vision into practical implementation across its three pillars: transport and trade connectivity, energy connectivity, and digital connectivity, potentially involving new pipelines and transmission cables. French Foreign Ministry spokesperson Pascal Confavreux confirmed G7 leaders are discussing financing and building infrastructure to bypass the Strait of Hormuz.
An EU official, speaking anonymously, stated that the EU would encourage European companies to invest in renewable energy projects in the Gulf to meet the EU’s energy demand. However, Gabriel Mitchell, an analyst with the German Marshall Fund think tank, noted that collaborative projects in Gulf countries would require time, and the most probable near-term projects are oil and gas pipelines due to their shorter construction timelines. Mitchell added that any new projects would need to align with the EU’s green policies, suggesting pipelines might be built with future dual-use capabilities for transporting both gas and possibly hydrogen. This indicates a continued reliance on fossil fuel infrastructure in the immediate future, despite rhetoric about green transition.
The State as Enforcer
Another project under consideration is the Great Seas Interconnector (GSI), an EU-backed electricity cable designed to stretch 1,208 kilometers, or 750 miles, to connect the power grids of continental Europe with EU member Cyprus and eventually Israel. Gallia Lindenstrauss, a senior fellow with the Israel-based Institute for National Security Studies, described GSI as a “very pragmatic solution for the modern energy needs” that facilitates the transition to green energies and provides a flexible platform for energy security. This project, while facing financing hurdles, aims to end the energy isolation of Cyprus and Israel and serve as an energy link to India, also forming part of IMEC.
The U.S. is actively fostering closer energy ties among Greece, Cyprus, and Israel, viewing the Eastern Mediterranean as “an increasingly important region for global energy development,” according to U.S. Secretary of Energy Chris Wright. Last week, Wright inaugurated the Eastern Mediterranean Energy Center at Rice University in Houston. The center's objective is to boost cooperation on developing natural gas deposits, U.S. liquefied natural gas infrastructure, and energy transportation networks in the European region. This U.S. state intervention directly serves the interests of fossil fuel corporations and the expansion of U.S. capital. The entire push for new routes and infrastructure, spurred by a war initiated by the U.S. and Israel, demonstrates how state power is deployed to secure and expand capital accumulation under the guise of "energy security" and "strategic autonomy."