Eighteen days into the war in Iran, and the scorecard for global equity markets makes for uncomfortable reading.
European benchmark indices have shed around 7% since hostilities began — the Euro STOXX 50 down 6.5%, Germany’s DAX off 7%, France’s CAC 40 down 7.2%, and Italy’s FTSE MIB lower by 6.4% — dwarfing the more modest 2.5% decline in the US S&P 500, which benefits from America’s status as the world’s largest oil producer and its relative insulation from the energy shock.
Yet the headline numbers tell only half the story.
Beneath the surface, an extraordinary divide has opened up — between European companies that thrive on expensive energy, and those being crushed by it.
The energy shock reshaping the continent
The conflict’s most immediate economic consequence has been a seismic repricing of energy.
Iran’s effective closure of the Strait of Hormuz — through which 20% of the world’s petroleum flows — caused Brent crude to surge from around $70 to nearly $120 per barrel within days.
As of Tuesday, Brent sits at approximately $105, a 42% rally from pre-war levels.
In an attempt to cap the oil price surge, the International Energy Agency coordinated a historic intervention.
More than 30 nations in Europe, North America, and northeast Asia agreed to release a combined 400 million barrels of oil from emergency reserves — the largest such action in the IEA’s 50-year history.
Yet the oil market has sent a clear signal that even this enormous release is nowhere near enough to address the unprecedented supply disruption, with crude prices surging more than 17% since the announcement.
Natural gas has been hit even harder. The Dutch TTF benchmark — Europe’s most important gas price reference — has surged 60% to €52 per megawatt-hour.
In a note this week, Goldman Sachs energy analyst Samantha Dart warned this week that approximately 80 million tonnes per annum of LNG supply — 19% of the global total — is currently offline following the Strait’s disruption and the shutdown of Qatar’s LNG production facilities.
Her team maintains a TTF forecast of €63/MWh for the second quarter of 2026, warning that tightening European physical balances could push prices into the gas-to-oil switching range before the conflict resolves.
The winners: Energy, renewables and fertilizer
The clearest beneficiaries have been European oil and gas producers, whose revenues move in lockstep with the commodity the war has repriced so dramatically.
Norwegian energy giant Equinor has surged 23.7% since the start of the month, as investors pile into one of the continent’s largest oil and gas producers with substantial assets well outside the conflict zone.
Fellow Norwegian producer Vår Energi is up 19.9%, while Aker BP has gained 17.1%. Italy’s Eni is up 14.7%, and Portugal’s Galp Energia has added 13.6%.
The most striking gains, however, have come from an unexpected corner: biofuels.
German renewable fuels producer Verbio SE has shot up 30.4%, and Finland’s Neste Oyj — the world’s largest producer of renewable diesel — has gained 28.1%.
As conventional fossil fuels become more expensive and supply chains more precarious, energy alternatives become dramatically more attractive to both buyers and investors.
German gas utility Uniper SE, which has spent recent years diversifying away from Russian supply, has rallied 19.1%.
The fertiliser sector has also attracted significant gains, with K+S rising 15.3% and Yara International rising 15.0%.
The moves reflect a commodity supply crisis hiding in plain sight: around one third of global seaborne fertiliser trade — roughly 16 million tonnes — passes through the Strait of Hormuz, including 43% of seaborne urea exports, 44% of sulphur, and over a quarter of traded ammonia.
The losers: Steel, airlines and construction
On the other side of the ledger, the losses have been equally dramatic. Energy-intensive industries and businesses exposed to higher costs with little pricing power have been savaged.
Airlines have taken some of the heaviest punishment. Wizz Air — the Budapest-based low-cost carrier with heavy exposure to Central and Eastern European routes — has collapsed 31.2%.
Air France-KLM has lost 22.1% and easyJet has dropped 21.8%. All three face the same brutal arithmetic: jet fuel costs have surged, hedging programmes offer only partial and temporary protection, and there is limited ability to pass costs on to passengers quickly enough to protect earnings.
Steel producers have been hit with similar force. Salzgitter has fallen 27.9%, thyssenkrupp is down 27.3%, and ArcelorMittal has shed 19.1%, joined by stainless steel specialist Aperam, which has dropped 24.5%.
Steel production ranks among the most energy-intensive industrial processes on earth, and mills operating on thin margins face an immediate profitability crisis when gas prices surge 60% in such a short period.
Spanish engineering contractor Técnicas Reunidas has dropped 23.7%, a casualty of its deep exposure to Middle Eastern energy infrastructure projects now thrown into uncertainty by the conflict.
Construction group Webuild has fallen 26.6%, reflecting broader fears that an energy-driven slowdown will freeze infrastructure investment across Europe’s most exposed economies.
Mining company Hochschild rounds out the list, down 21%, rising energy costs compress margins and risk appetite for smaller extractive names evaporates.
Europe enters this crisis in a structurally vulnerable position.
Despite having dramatically reduced its dependence on Russian pipeline gas since the invasion of Ukraine, the continent remains acutely sensitive to energy supply disruptions — and gas storage levels heading into 2026 offer less of a buffer than in prior years.
