SPAIN has joined forces with four other European allies to call for a windfall tax on the profits raked in by energy companies as fuel prices continue to soar in response to the ongoing conflict in the Middle East.
Deputy prime minister Carlos Cuerpo made the plea in a joint letter written with finance ministers from Germany, Italy, Portugal and Austria, which said such a measure would be a signal that ‘we stand united and are able to take action’.
“We are asking the EU Commission to explore a temporary solidarity instrument for energy companies to contribute from war-driven windfall profits and ease the burden on consumers and taxpayers,” Cuerpo said in a post on X.
Oil and gas prices have surged since the United States and Israel launched strikes on Iran on February 28, with Brent crude, the global benchmark for oil, hitting a high of $116 (€101) per barrel during market trading on Monday morning.
The surge comes as Iran continues to effectively shut down the Strait of Hormuz, a vital maritime shipping route through which around 20 per cent of the world’s oil and liquified natural gas passes.
Shipping traffic exiting the Persian Gulf through the strait has been halted and tankers are stranded amid the risk that vessels could be attacked.
The shortage has led economists to liken the ongoing situation to the 1970s energy shock, with the war in Iran continuing to drive the price of oil to eye-watering highs.
On Tuesday, the EU’s energy chief said that residents of Europe should work from home, fly less and drive 10kph slower on motorways in an effort to cut down on energy costs.
“Even if…peace is here tomorrow, still we will not go back to normal in the foreseeable future,” Dan Jorgensen said after a meeting of EU energy ministers.
“The more you can do to save oil, especially diesel, especially jet fuel, the better off we are. This must be the time we finally turn the tide and truly become energy independent.”
In Spain, the government has moved to contain the fallout by pushing through a €5 billion relief package comprising 80 measures, including a VAT cut on fuel that has slashed prices at the pump by up to 30 cents per litre.
THE LETTER IN FULL:
Dear Commissioner,
The conflict in the Middle East has caused oil prices to rise, placing a significant burden on the European economy and on European citizens. It is important to ensure that this burden is distributed fairly.
At the Eurogroup meeting on 27 March 2026, we advocated and supported measures to tax the windfall profits of energy companies. A comparable instrument was already introduced in 2022 through a temporary solidarity contribution established by Regulation (EU) 2022/1854 of 6 October 2022 on an emergency intervention to address high energy prices.
Given the current market distortions and fiscal constraints, the European Commission should swiftly develop a similar EU-wide contribution instrument grounded on a solid legal basis (and without prejudice to all other efforts and measures by the individual Member States in order to address high energy prices).
Such a European solution would act as a signal to the citizens of our Member States and to the wider economy, demonstrating that we stand united and are able to take action. It would also send a clear message that those who profit from the consequences of the war must do their part to ease the burden on the general public.
Working together and finding a European solution is the right approach. It would make it possible to finance temporary relief, especially for consumers, and curb rising inflation without placing additional burdens on public budgets.
We are pleased that the European Commission has promised to swiftly review the matter. In this context, it is worth considering the question of whether and how the foreign profits of multinational oil companies can be included in a more targeted way than was the case with the 2022 solidarity contribution.
Yours sincerely,
Dr Markus Martebauer, Federal Minister of Finance of Austria
Lars Klingbeil, Federal Minister of Finance of Germany
Giancarlo Giorgetti, Minister of Economy and Finance of Italy
Joaquim Miranda Sarmento, Minister of State and Finance of Portugal
Carlos Cuerpo, Minister of Economy, Trade and Business
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