European nations are largely willing to support the United States to ensure the free flow of cargo through the Strait of Hormuz once the conflict with Iran reaches its conclusion—but they’re not going to enter the fray ahead of that point, officials intimated at the Semafor conference this week in Washington, D.C.
French Finance Minister Roland Lescure said, “France is willing, with the U.K. and others, to make sure that we can fortify the Strait of Hormuz once de-escalation takes place, not before.”
“This is going to be a peacetime operation to stabilize the strait if we get there, but first we have to get there. That requires negotiations between Iran and the U.S.,” he added. As such, France won’t be sending convoy ships to join in the war anytime soon, Lescure said, noting, “We are not a belligerent; we are not a part of this conflict.”
The comments took place mere days after Vice President JD Vance and a group of U.S. negotiators returned from marathon talks with Iranian officials in Pakistan over the weekend without a deal. The tense negotiations, which lasted over 20 hours, ended due to Iran’s refusal to abandon its nuclear program.
Afterward, President Donald Trump said the U.S. would blockade the strait, preventing ships from passing through entirely. On Monday, more than 15 U.S. warships were in place in the Middle East to support the operation.
Asked about the war’s cost to France, Lescure said the country is “less exposed than others” to price shocks when it comes to the flow of energy products through the strait. He noted, “There’s about 12 million barrels [of oil] missing every day, and most of those barrels are missing in Asia.”
Still, Lescure is sensitive to the macro impacts that protracted constraints on cargo flow could have on the world economy, including in Europe, where some officials warned that “stagflation” is brewing. A lethal combination of stagnating growth and heightened inflation could be imminent if the strait, which carries about 20 percent of the world’s oil, remains unsafe to pass through.
“What matters for me—I’m the finance minister—is that we find ways of de-escalating. I don’t want to escalate,” Lescure said.
“We need this to be sorted in weeks, because we know that once this is beginning to be sorted geopolitically and hopefully peacefully, that still will be quite a few weeks of turbulence to go through before we go back to normal, if we ever could go back to normal,” he added.
Greek Finance Minister Kyriakos Pierrakakis approached the issue with a cool head but a sense of urgency.
Asked what the “Iran shock” looks like, at a high level, for Europe, he said, “Let me start by addressing this question and repeating what Fatih Birol, the executive director of the International Energy Agency, said recently, which is quite alarming—that we’re potentially facing the greatest energy crisis in history if we don’t address it properly.”
“If the Strait of Hormuz remains closed for a prolonged period of time, it’s going to be big,” he added. And it’s not just about the flow of oil. One-third of the world’s fertilizer passes through the strait, along with half of the sulfur consumed globally. Asia is feeling the impacts of the constraints on natural gas acutely, “But the prices are global to a very large extent, so we’re all feeling it,” Pierrakakis said.
Greek Finance Minister Kyriakos Pierrakakis
Sourcing Journal
The official, who is also the president of Eurogroup, the collective of 21 European finance ministers whose countries use the euro as their official currency, said that stagflation in the region would be the “worst case scenario,” but “we’re not yet there.”
However, he added, “The calculation that the International Energy Agency is making is, unfortunately, even in the best case scenario, also a bit worrisome.” Over 80 Gulf energy facilities have been affected so far—and some “severely.” It could take two months to get supply flowing at all, and not at previously seen levels.
What’s not at risk, he emphasized, is the future of the relationship between the U.S. and its European allies, even though they’re unwilling to back up the Americans militarily in the conflict.
“I firmly believe in the strategic nature of the relationship between the U.S. and the EU; we have been very close for hundreds of years. There can be turbulence in that relationship. There are disagreements in that relationship that we have seen, be that in trade relations, be that the question of Greenland previously,” he said.
“But I firmly believe that the strategic interest of both the U.S. and the EU is to have a close and collaborative relationship on every front,” he added, whether it’s on geopolitics or technology, like the AI race. “I think that all of us need good friends, and all of us, at the end of the day, will act fully strategically.”
