The European Union is considering emergency relief measures, including a cap on natural gas prices, in response to soaring energy costs driven by the conflict in the Middle East, European Commission President Ursula von der Leyen stated on Wednesday.

Addressing the European Parliament, von der Leyen revealed that over the ten days since the outbreak of hostilities, skyrocketing oil and gas prices have cost EU taxpayers an additional €3 billion ($3.5 billion) for fossil fuel imports.

"The pressure on households and businesses is immense right now. Therefore, we must provide relief immediately," the EU's top official said.

She added that it is crucial for the European Commission to mitigate the cost impact, particularly in situations where gas prices determine electricity costs.

"We are preparing a range of options—better utilization of power purchase agreements and contracts for difference, providing state aid measures, and we are exploring the possibility of subsidies and even a cap on natural gas prices," von der Leyen stated.

In 2022, following Russia's invasion of Ukraine and the subsequent halt of pipeline gas supplies to most European nations, the EU implemented an emergency price ceiling for gas. However, this mechanism was never activated.

European benchmark gas prices have surged to their highest level in nearly three years. This increase follows Qatar's announcement of a production halt at Ras Laffan, the world's largest liquefied natural gas (LNG) complex, issuing force majeure notices to customers, and the effective closure of the Strait of Hormuz to tanker traffic.

Last week, European gas prices jumped by 67%, marking the largest weekly increase since the 2022 energy crisis. This surge was primarily due to the effective shutdown of the Strait of Hormuz, a passage for approximately 20% of global LNG trade.

With 20% of global LNG supplies expected to be offline for at least several weeks, Europe is beginning to lose out to Asia in the competition for spot supply. As competition for supplies intensifies once more, Asia is attracting a majority of flexible LNG cargoes away from Europe. A growing number of LNG shipments originally destined for Europe are being diverted mid-Atlantic, rerouting via the Cape of Good Hope to Asia.