Governments spent €18 billion in 2026 to cushion energy price jump

European Union governments spent €17.9 billion in 2026 to cushion households and firms from higher oil and gas prices, the European Commission said, in guidance for euro zone finance ministers meeting on October 8. The note urged countries to better target support and highlighted that borrowing costs for member states have risen, calling for fiscal prudence. While growth would be slightly stronger than the May 0.9% forecast, next year’s growth is expected to be weaker than the May projection of 1.2%. Inflation is forecast around 3.0% this year, rising to 2.3% in 2027. The Commission also urged investing in power grids and taxing electricity less than gas, noting that more than two-thirds of current support is untargeted price measures.