Energy taxes have been slashed in 39 economies, twice the number seen a month ago, as war‑driven oil and gas price spikes force governments to act. European states now account for 19 of those cuts, a move that clashes with IMF warnings that fiscal relief should be targeted and temporary.

Bruegel analysis shows European governments have earmarked almost €9.5bn to cushion the war’s impact, yet over 80% of that aid lacks a clear target group or conditionality. Germany pledged €1.6bn to cut fuel duties, Spain €3.5bn to reduce energy VAT, and Italy’s 20% excise cut will cost roughly €1bn for 45 days.

Only three European countries have introduced measures to curb consumer energy use, compared with 19 in the Asia‑Pacific. Meanwhile, France and Portugal have demonstrated that targeted subsidies can coexist with fiscal discipline, offering €70mn to suspend fuel excise for farmers and supporting logistics and fishing fleets while boosting electrification.

The flood of untargeted tax breaks risks stoking demand, driving prices higher and undermining clean‑energy incentives, analysts warn. With public debt already stretched, governments face a dilemma: provide immediate relief or risk pushing finances toward a crisis threshold. The current policy mix signals that many states will prioritize short‑term consumer comfort over long‑term fiscal health.