Hungarian Prime Minister Péter Magyar on Thursday cast doubt on a deal struck by his predecessor that would see Russia’s state nuclear company Rosatom expand Hungary’s nuclear power capacity.

Weeks of extreme heat and drought have pushed the Danube River to record lows, slashing output at Hungary’s Paks nuclear plant — which normally supplies around a third of the country’s electricity — to little more than 10 percent.

“These plans were accepted despite the fact that nuclear power plants that do not operate with a closed-circuit cooling system and are so exposed to the environment are no longer being built in the world,” said Magyar, per local media.

Rosatom CEO Alexei Likhachev wrote that the Russian state nuclear company was still on schedule with two new reactors at Paks despite Hungary’s change of government in April, which saw Magyar oust Russia-friendly incumbent Viktor Orbán.

Concrete preparation for Unit 5 is more than 80 percent complete, he said, while work on Unit 6 is advancing and reactor components are already being manufactured.

“We are ready for dialogue,” Likhachev said, adding that Rosatom had received no questions from Hungary’s new government.

Magyar challenged that account hours later. Under the original contract, Paks II should have been operating by 2024, he told reporters in a press conference Thursday. Instead, Hungary has spent roughly 1,000 billion forints (€2.8 billion) on a site he described as little more than depots and “two large concrete pits.”

“I don’t really see that they have adhered to the contract,” Magyar said. His government is now carrying out a full review of the project, including its financing and cooling arrangements.

The review cuts at one of Orbán’s signature deals with Russia. Orbán struck the Paks II agreement in Moscow in 2014, handing Rosatom the two-reactor expansion backed by up to €10 billion in Russian state financing. Two years later, he called it the “deal of the century.”

Those ties survived Moscow’s full-scale invasion of Ukraine. As recently as March this year, Orbán’s foreign minister Péter Szijjártó admitted to discussing EU sanctions with senior Russian officials after leaked calls showed him boasting that a bank linked to Paks had been kept off a sanctions list.

Downstream, Romania shut the second and last operating reactor at Cernavodă on Thursday after the Danube fell too low to supply its cooling pumps.

Romania took Cernavodă’s second and last operating nuclear reactor offline on Thursday after the drought-hit Danube River fell too low to supply its cooling pumps.

“At 10:53 a.m., Unit 2 of Cernavodă NPP was shut down in a controlled manner,” Romania’s Energy Ministry said in a press release.

The government insisted the national grid remained stable and said it would bridge the shortfall with imports, hydropower, wind, coal and reserve generation. Romania had already notified the European Commission of an electricity crisis after the shutdown of Unit 1 on July 28, with Unit 2 accounting for roughly another 700 megawatts — about 10 percent of national production.

Cernavodă could stay offline for a while. “The forecast for the next 10 days shows a continuous decrease in the flow and level of the Danube,” plant director Romeo Urjan told Romanian news outlet Digi24 on Tuesday evening, saying officials did not expect to restart Unit 2 during that period.

Emergency dredging, rock blasting and sunk barges had bought the reactor roughly another week of operation.

The shutdown is the latest fallout from a drought emptying Europe’s rivers. Copernicus Sentinel-2 satellite images released last week showed the Danube shrinking dramatically compared with last summer, exposing sandbanks and parched countryside north of Budapest in Hungary.

The river has hit a record low in Hungary, while record-low levels have also been reported in Romania, disrupting shipping and straining energy and water supplies.

Hungary is scrambling to keep its Paks nuclear plant operating. With output down to little more than 10 percent, Prime Minister Péter Magyar ordered the construction of a riverbed barrier Wednesday and put two barges on standby to be sunk if the Danube falls further.

Cernavodă’s two reactors normally supply around a fifth of Romania’s electricity. Before this summer, drought last forced a reactor there offline in 2003.

White House press secretary Karoline Leavitt is leaving her role at the end of August, President Donald Trump said Wednesday.

The president, in a post on Truth Social, said Leavitt is departing to spend more time with her family, but will remain one of his “top outside advisors” and an “influential voice within the Republican Party.”

“Karoline has been one of the best White House Press Secretaries in the History of the Office,” Trump wrote.

Leavitt’s departure comes on the heels of a leave of absence this summer after the May birth of her second child, Viviana. She returned to the White House last month.

Leavitt gave birth to her first child, Niko, during the 2024 presidential campaign, returning to work quickly when the president was shot in Butler, Pennsylvania.

Leavitt, in a post on X, described the job as “the honor and adventure of a lifetime,” but said she had decided to step away to devote her time to being a mom.

“The truth is since returning to the White House after the birth of my daughter, I have felt in my heart that I cannot be the best mom my two young children deserve while devoting the constant time, energy, and attention required of the White House Press Secretary,” she said, “and that is why I have ultimately made the bittersweet decision to depart the White House and embark on a new chapter in my life.”

Trump, in his post, called it “a decision I totally understand and respect!”

Leavitt has served as White House press secretary since the start of the second Trump administration. During Trump’s first term, she interned in the White House Office of Presidential Correspondence while in college before becoming associate director, eventually joining the White House press team as assistant press secretary under then-press secretary Kayleigh McEnany.

As press secretary, she has been widely praised on both the left and the right for being an effective communicator for the president in the White House briefing room. She earned a reputation for her tough but friendly banter with the press in that format.

The White House did not immediately answer questions about who will succeed Leavitt as press secretary and the timeline for replacing her.

Trump had four press secretaries during his first term: Sean Spicer, Sarah Huckabee Sanders, Stephanie Grisham and McEnany.

Form Energy has landed Google and Crusoe as customers. Now, it has raised $750 million to expand manufacturing to deliver its massive, 100-hour batteries.

LONDON — Prime Minister Andy Burnham will lead a meeting of the government’s emergency committee Wednesday afternoon in response to ongoing heatwaves, droughts and wildfires across the U.K.

COBR (Cabinet Office Briefing Room) meetings are convened during a crisis or emergency — and come as the record-breaking conditions take a severe toll on U.K. infrastructure.

The crisis is an early test for Burnham, who came to office just last month.

A Downing Street spokesperson said: “We know how challenging this summer is proving, particularly for firefighters tackling wildfires, farmers working in drought conditions, and NHS staff in busy A&E units.

“We will continue to take the action needed to keep communities safe, protect water supplies, support farming communities and safeguard the environment.”

Britons are this week bracing for their fifth heatwave of 2026, with some temperatures forecast to exceed 36C. The Met Office, Britain’s national weather service, has warned that this summer is set to be the U.K.’s hottest since records began.

More than two-thirds of England is now in drought after the driest July since records began in 1836. The whole of Wales is also in drought, and more than 27 million people across the U.K. are facing water restrictions including hosepipe bans.

The U.K. is grappling with wildfires including at the New Forest national park in south England. The National Fire Chiefs Council responded to 458 wildfires last month, its busiest month on record.

‘Snail’s pace’

The rival Green Party first demanded a COBR meeting weeks ago after a wildfire engulfed parts of Suffolk in eastern England. Green Leader Zack Polanski said Wednesday’s meeting is “only a first step. This is a climate emergency which is leading to hundreds of deaths and stretching our firefighters, health staff and farmers to the limit. What we urgently need is concrete action.”

Liberal Democrat Energy Spokesperson Pippa Heylings warned a COBR meeting alone “will not put out fires or protect our communities,” and said government is “moving at a snail’s pace.”

Prior to today’s COBR, the U.K.’s National Drought Group and Severe Weather Resilience Network have held regular meetings, and the government has also vowed to work with water companies to build nine new reservoirs for the U.K. — which built its last reservoir back in 1992.

U.K. climate advisers have meanwhile spent much of the summer urging the country to up its game when it comes to adaptation for a warming world.

The Committee on Climate Change, a government advisory body, said in May that cooling to protect from heat, “increased flood preparedness, and improved water management are the highest priorities.”

“Deploying these adaptations at scale will help avoid loss of life – particularly amongst those most vulnerable to climate impacts – and unnecessary damage and disruption to people and to the economy,” it said.

The U.K. has been “built to a climate that no longer exists,” Swenja Surminski, a member of the Climate Change Committee Adaptation Committee, told MPs in June.

Additional reporting by Charlie Cooper.

California is launching a probe into the Trump administration’s most recent move to scuttle the state’s nascent offshore wind industry.

Gov. Gavin Newsom’s administration on Tuesday released an investigative subpoena against German energy company RWE, according to David Hochschild, chair of the California Energy Commission.

“These are unlawful actions … they’re using funds that are not dedicated to those purposes, and we’re going to vigorously contest those,” Hochschild said of the Trump administration’s settlement agreements to kill offshore wind projects. “We’re going to court.”

He made the announcement on stage during POLITICO’s The California Agenda: Sacramento Summit.

Hochschild’s statements show that California, facing a relentless assault on its offshore wind ambitions, is turning to the courts as its primary venue for fighting back.

RWE announced a $1.2 billion agreement on Thursday to surrender its offshore wind leases off the coasts of New York, California and Louisiana. That signaled the continued success of a recent Trump administration strategy to kill wind projects it opposes: offer the developers funds to instead invest in fossil fuel facilities. That tactic has so far ended three of the five planned wind projects off the California coast.

In May, California issued a similar investigative subpoena to Golden State Wind after it cut a Trump administration deal to cancel an offshore wind project. The state later said it intended to sue over that deal. California followed that same playbook with Invenergy’s offshore wind cancellation. It has not filed any lawsuits in response to the deals to date.

Aug. 11 is quickly becoming jellyfish invasion day at the Gravelines nuclear power plant in northern France.

Despite spending hundreds of thousands of euros to protect the plant from a jellyfish swarm like the one that saw reactors shuttered on Aug. 11, 2025, French utility provider EDF on Tuesday was again forced to bring the parts of the facility offline due to the presence of “several dozen tons” of jellyfish blocking pumping systems.

“On-site teams are fully mobilized to ensure the safety of the facilities and to reconnect the reactors to the national power grid,” EDF said in a statement.

Three fishing vessels are now “constantly patrolling off the coast of the plant” to conduct “preventive fishing operations […] 24/7,” the company added.

Tuesday’s jellyfish invasion comes a the latest in a series of climate change-driven incidents that have affected French nuclear energy during a particularly infernal summer.

Nuclear power plants are typically built by rivers or on coastlines so they can use nearby water sources to cool their reactors. But a record number in France this summer have been forced to temporarily shut down due to heatwaves and droughts affecting their water supply.

Rising sea temperatures have made jellyfish swarms more common along the French coast in recent years, and those swarms can affect a plant’s ability to bring in seawater — which is what happened at Gravelines. Following last year’s incident at the plant along the North Sea, EDF installed cameras and deployed fishing boats to monitor the situation.

While the vessels “prevented a massive influx of jellyfish” on Saturday and Sunday, they were eventually overwhelmed as the swarm grew from “about 100 kilograms” to “several dozen tons,” the French state-owned utility giant said.

Opponents of nuclear energy were quick to jump on the incident.

“This only highlights that nuclear power plants are ill-equipped to deal with the consequences of climate change,” the French branch of Greenpeace said in statement.

Fusion power startups are turning to Kyoto Fusioneering to supply components for future power plants. The Japan-based startup just received a grant to build a part of the fuel system.

Solar energy, at any time of day or night - that's the dream of space mirror projects. Futurists have been imagining satellite mirrors that could reflect the sun's light onto the Earth's surface for over a century. Russian scientists experimented with the concept in the '90s with the Znamya project. The idea is to put a large mirror in orbit and angle it such that sunlight can be reflected onto a specific geographical area for illumination or the generation of solar power.

Now, the California-based company Reflect Orbital wants to try this idea again, launching a test satellite named Eärendil-1 as a precursor to a fleet of up to 50,000 spa …

Read the full story at The Verge.

MIRROR, ALBERTA — Nestled within a sleepy community campground and roadside cafe, hundreds of Canadians are gathered to imagine a new country of their own.

It’s July 1, and they’re hosting a family-friendly event that looks like a typical Canada Day celebration. Live music, a farmers’ market, hamburgers on the grill. Except there isn’t a Maple Leaf in sight.

Instead, people have wrapped themselves in Alberta’s flag, wave “we’re done” banners and wear “Trump 2024” and MAGA — Make Alberta Great Again — ball caps. This is an “Albertans’ Day” gathering at the Whistle Stop Cafe, which gained notoriety for bucking pandemic-era rules and which former Alberta premier Jason Kenney calls “ground zero” for the province’s fast-growing separatist movement.

Instead, people have wrapped themselves in Alberta’s flag, wave “we’re done” banners and wear “Trump 2024” and MAGA — Make Alberta Great Again — ball caps. This is an “Albertans’ Day” gathering at the Whistle Stop Cafe, which gained notoriety for bucking pandemic-era rules and which former Alberta premier Jason Kenney calls “ground zero” for the province’s fast-growing separatist movement.

And until Alberta separates, Moore places her faith not in Canadian Prime Minister Mark Carney — whom she views as part of a Davos “cabal” — but in U.S. President Donald Trump.

“I kept thinking this: Trump is the only one that can save us.”

Moore’s affinity for conspiracy theories is shared by many, though certainly not all, of the separatists. Resentment toward the federal government in Ottawa is longstanding in Alberta. But a surprising new ingredient has turbocharged the separatist push: Trump and the increasingly toxic U.S.-Canada relationship. The separatists are furious about Carney’s friction with Trump and the fraying ties to their southern neighbor. Some even hope the Trump administration might help their cause.

Many separatists believe Trump’s presidency makes Alberta’s independence possible, with the United States a ready customer for its oil and gas should they split from Canada. One group, the Alberta Prosperity Project, is trying to seek a C$500-billion U.S. government loan to fund the province’s “seamless departure” from Canada.

“This isn’t your grandfather’s independence movement,” says Jeffrey Rath, a co-founder of the Alberta Prosperity Project and a longtime separatist activist who has sought to court the Trump administration.

Many separatists see a cultural kinship with the United States. They proudly share fake newspaper clippings that highlight the province’s history of early American settlers allegedly helping to shape a self-reliant, frontier culture that remains in Alberta today. They argue the Eastern provinces are more associated with European traditions than American ones.

While some object to Trump’s idea of making Canada the 51st American state, others embrace the idea.

“I like freedom and less taxes,” says Casey Phillips from Edmonton, Alberta.

Carney and his government are now working hard to convince skeptical Albertans their best prospects lie with a united Canada. He and Alberta Premier Danielle Smith, who called the Oct. 19 vote, are touting a new pipeline agreement to send western oil abroad. The effort may work with some swing voters, but the hard-core separatists aren’t likely to buy it.

“It will never happen because Canada’s a communist country and there will be 24 years of paperwork,” Phillips says of the pipeline project. “It’s all lies.”

The separatists have good reason to think the Trump administration could be an ally. In January, Treasury Secretary Scott Bessent called Alberta a “natural partner for the U.S.” while referencing the province’s “great resources.”

“People are talking,” Bessent told conservative podcaster Jack Posobiec, nodding to the separatist movement. “People want sovereignty. They want what the U.S. has got.”

Rath says he has requested introductions to the U.S. Treasury Department and major financial institutions like JP Morgan Chase and Goldman Sachs to build a day one feasibility plan for Albertan independence, though it’s unclear if he has had any such conversations.

The Alberta Prosperity Project, however, has taken three trips to Washington, D.C., and Rath insists the group has met with “very senior level” officials, who he says have taken their information directly to the White House.

A State Department spokesperson said the department “regularly meets with a wide range of representatives. We do not anticipate any future meetings, and all department engagements are at our sole discretion.”

“As Ambassador to Canada Pete Hoekstra has said, the vote is a decision for the people of Alberta,” the spokesperson added.

Bessent made his comments amid heightened U.S.-Canada tensions; days earlier Carney had argued at Davos that middle powers needed to form new coalitions after the Trump-fueled “rupture” in the global order.

That episode inflamed the pro-America separatists, as did Carney’s subsequent use of the phrase “new world order” during a January trip to China to sign new energy and trade agreements. That phrase is catnip to those who fear the creation of a global government, and more conspiracy theories quickly seeped into Alberta’s separatist movement through Facebook groups and YouTube videos claiming Carney is steering the country toward communism and against the U.S.

But it’s also true that Alberta’s grievances with Ottawa began long before Carney jostled with Trump. They have been passed down for generations, rooted in a belief that the federal government has ignored, exploited or misunderstood the province since its founding.

Today, that resentment has become deeply personal. Separatists point to what they see as federal overreach and clean energy policies that have made life more expensive and undermined their economy.

Federalists, meanwhile, are alarmed that neighbors, friends, family, and sometimes even spouses, are “willing to betray their country,” in Kenney’s words.

Former Conservative MP Damien Kurek cautions against dismissing separatists as traitors. Instead, he argues, politicians should ask why so many Albertans feel abandoned by the federation.

For Kurek, one of the defining moments of Albertan anger came in 2021, when U.S. President Joe Biden cancelled the Keystone XL pipeline on his first day in office by revoking its cross-border permit.

The ripple effects spread throughout Kurek’s riding. He says mechanics had fewer oilfield trucks to repair and restaurants served fewer meals, while roadside motels sat empty and young families put off buying homes.

But what many Albertans remember most isn’t Biden’s decision. It’s the belief that Ottawa, under then-Prime Minister Justin Trudeau, failed to fight it.

“I was very frustrated with the Liberals, including many Liberals that told me that I just needed to accept it, that are still on the Liberal Cabinet benches today,” says Kurek, whose riding included Hardisty, Canada’s largest oil pipeline hub.

That moment reinforced a deeper belief among many of his constituents, he says: If our national leader won’t stand up for us when we need him most, the very “promise of Canada” was in question.

Many in rural Alberta feel like their communities live or die by decisions made thousands of miles away in Ottawa. But this was just another chapter in a much longer story.

Kenney, the former Alberta premier, traces Western alienation back to the province’s creation in 1905. He says Ottawa initially treated Alberta more like a colony than an equal partner, including delaying provincial control over its natural resources.

The modern separatist movement then took shape in the 1980s after former Liberal Prime Minister Pierre Elliott Trudeau introduced the National Energy Program, which raised taxes on oil companies and oil exports and shifted more of the industry’s profits from Alberta to Ottawa. The unpopular program was dismantled five years later, but Albertans didn’t forget.

When Trudeau’s son, Justin, became prime minister in 2015, his government introduced environmental policies that Alberta’s oil industry argued made it more difficult and expensive to build pipelines, expand production and attract investment.

Albertans’ sense of alienation also extends beyond energy policy. Many feel their votes carry less weight than those cast in vote-rich Ontario and Quebec, since that’s where federal elections are often decided. After repeatedly electing Conservative MPs only to see Liberal governments take power in Ottawa, some have concluded federal elections have little effect on Alberta’s fortunes.

That frustration is compounded by Canada’s equalization program, enshrined in the Constitution, which redistributes federal tax revenue to help less wealthy provinces fund public services. Because Alberta’s oil-rich economy is one of the country’s wealthiest, it has never qualified for those payments. At the same time, Ottawa collects more in federal taxes from Albertans than it spends in the province, which reinforces a decades-old belief that Alberta bankrolls the rest of the country while getting too little in return.

“It’s very scary to see what they’re trying to take from us, what they’re trying to control,” says Trina, a Red Deer resident who volunteers with a separatist group and who did not give her last name. “It leaves us with a lot of uncertainty. Nothing feels secure.”

Carney is aware of the challenge ahead. Even as he has warned Alberta against stumbling into its own Brexit disaster, he has sought to address the province’s most tangible concerns.

Last November, Carney signed an agreement with Alberta to work toward a new oil pipeline and soon after, delivered a sobering wake-up call to his Liberal caucus behind closed doors.

To the surprise of MPs in the room, Carney opened his remarks by addressing the specter of Alberta separatism, framing the pipeline deal not just as an economic win, but as a strategic necessity to keep the country together.

“He was emotional,” a Liberal MP, who was granted anonymity to discuss internal party matters, told POLITICO at the time. “You could hear a pin drop.”

It was a clear sign from the prime minister that the separatist movement was shaping his thinking — and federal policy.

“This was a no-BS kind of thing,” the Liberal lawmaker said. “This was coming from someone who grew up in that province, who understands that province, and who was very worried about the feelings of alienation.”

The speech also marked Carney’s first step in persuading Liberal supporters — many of whom had embraced Justin Trudeau’s aggressive climate agenda — that pipelines, increased oil production and energy exports were essential to Canada’s economic and geopolitical future.

Carney has made a similar pitch to the broader public.

“In Canada, we are strongest when we are united — when we look out for each other and ensure that no child, no family, no one is left behind,” Carney said in a speech to Canadians and his Cabinet in January. “This spirit of solidarity and generosity helps define us as a nation.”

Nine months later, Carney has backed up that message with action. Since taking office, he has rolled back several Trudeau-era environmental policies despite pushback from some Liberal MPs, including former environment minister Steven Guilbeault, who is leaving politics after accusing his party of “backsliding” on climate action. Last month, the West Coast oil pipeline got closer to fruition, after Carney’s government announced its partnership with Alberta would amount to a C$35 billion project in a bid to boost the province’s energy sector.

The policy shift is part of Ottawa’s effort to encourage federalists to send a strong message on Oct. 19, that they want to remain in Canada. In July, Carney made three trips to Alberta, two of which included photo-ops with Smith, Alberta’s premier. Both have been framing their pipeline pact as proof that Canada still works, for all its people, even as many separatists argue it comes a decade too late.

Federalists say the biggest risk in the vote isn’t necessarily that Alberta endorses moving toward separation; polls show about 30 percent of Albertans want independence. It’s that federalists don’t show up to vote since they assume victory. If turnout is low, a highly motivated separatist base could post an unexpectedly strong result, giving the movement new legitimacy and driving away private investment in the province.

“We can all think that the worst isn’t going to happen. We could put signs on our lawn and write poetry about Canadian unity. But honestly, unless people show up at the polls on Oct. 19, we could lose this referendum question,” says Eleanor Olszewski, a federal Liberal cabinet minister from Alberta.

Back outside the Whistle Stop Cafe, the conversations at Albertans’ Day drift from claims Carney wasn’t democratically elected, to beliefs the pandemic was orchestrated by global elites, to how a federal ban on assault-style firearms is meant to stop Canadians from rising up against the federal government.

One vendor sells knives, stun batons, tactical shovels, night-vision glasses and body shields, encouraging Albertans to protect themselves. Pickup trucks and SUVs are modified to look like sheriff’s vehicles with “Republic of Alberta” decals. Some separatists show off homemade T-shirts that read “skid mark Carney” or “pure-blood warriors” showcasing a white baby in the paws of a lion.

The antipathy toward Carney and enthusiasm for Trump even has some separatists ready to defend Trump’s wave of tariffs against Canadian goods.

Keith Walker, who is from a small farming community in southern Alberta, believes the only thing preventing Canada from becoming a communist country under Carney is Trump’s trade war.

Canada, in his view, is part of a group of governments that Trump is trying to dismantle alongside Venezuela, Cuba and Iran. “That’s why that’s happening,” Walker says of Trump’s tariffs; he and a friend are both wearing Trump 2024 hats.

The separatists’ longstanding grievances with Ottawa aren’t occurring in a vacuum. Populist forces have reshaped the globe over the last decade, amid Brexit and Trump and the pandemic, and they are now converging in Alberta.

Separatism has become a right-wing uni-cause.

“It is a perfect umbrella,” Kenney says, “for every obsession, paranoia and anxiety on the right.”

There's two things you should know about me, your intrepid reviewer: I hate the feature creep associated with modern power banks, and I love shaving grams off the gear I carry when backpacking, bikepacking, and trail running. So imagine my delight when Nitecore released a new generation of its ultralight NB10000 battery. After a few weeks with it I can confidently say: Haribo be damned!

The $83.95 NB10000 Gen 4 weighs just 146 grams, according to my scale, and measures 1.45 x 11.6 x 4.68cm (0.57 x 4.57 x 1.84 inches), according to Nitecore's spec sheet. That makes it the lightest and most compact 10,000mAh power bank I can find. Even when …

Read the full story at The Verge.

BERLIN — Europe’s reserves of natural gas are running dangerously low, risking fresh energy woes if the Iran war rages on and cold spells drive up heating demand over winter.

But the continent’s top energy user doesn’t seem too bothered.

Germany is the EU’s biggest vulnerability because its sheer size means gas shortfalls there could be felt in neighboring countries, driving up prices across the bloc if it fails to restore its reserves.

That’s prompted growing calls for Berlin to do the unthinkable: intervene outright to direct its state-controlled energy giants to buy gas at any price, abandoning years of free-market doctrine on energy policy.

So far, the government has refused to budge, even as it falls short of EU targets and faces the risk of physical supply shortages as early as November. It’s a gamble that the markets will figure everything out, even as war and hot weather distort traditional incentives and upend global supply chains.

“Storage levels are not only exceptionally low for this time of year, but historically low,” said Sebastian Heinermann, the managing director of Germany’s top gas storage association, INES.

But Germany, he warned, is still relying on an outdated, market-oriented approach to refill its reserves, even when there are “hardly any market-economic incentives left.”

Since Russia’s invasion of Ukraine in 2022, EU countries have been required to hit gas storage targets of 90 percent of national capacity by winter to prevent serious supply shortfalls. The EU lowered that target to 80 percent following the outbreak of the Iran war to prevent panic buying.

Typically, refilling is the responsibility of traders and utilities, which buy gas cheap in the summer to store and then sell in the winter for a profit. But buyers say higher summer prices as a result of the Iran war and climate change have upended that dynamic, leaving gas reserves across the bloc at around 58 percent of national capacity, 16 percentage points below the five-year historical average and the lowest level since 2011. 

The low reserves have already added to the increased pressure on gas prices linked to renewed tensions around the Strait of Hormuz, with the European natural gas benchmark now consistently higher than it was for the first four months of the Iran war.

The European Commission, the EU’s executive arm, has said the bloc faces no winter supply risks. But a report by energy analytics firm Rapidan projects that reserves will rise to only 65 percent of total storage capacity by November, arguing that hitting the EU’s target by winter won’t be possible without “materially higher prices.” 

That risk has been exacerbated, analysts say, by the bloc’s move in recent years to replace its long-term supply deals with Russia with short-term purchases of globally traded liquefied natural gas. These seaborne cargoes are highly mobile and go to the highest bidder — leaving buyers more exposed to volatility on international markets, especially in the wake of the loss of key supplies from Qatar and rising demand in Asia.

Germany, the bloc’s largest gas consumer, has seen its reserves fill up even more slowly than others, in part thanks to its more hands-off, market-led approach to restocking than many of its neighbors. As a result, reserves stood at only 47 percent of national capacity in August, according to the latest data — the lowest fill level since records began. That’s especially worrying as the country’s reserves are important for the bloc as a whole, representing over 20 percent of the EU’s storage capacity. 

Nevertheless, Berlin is staying the course. While its energy ministry has acknowledged the country’s historically low reserves, it has refused to intervene to direct its main state-controlled gas buyers, SEFE and Uniper, to buy gas at current prices to ensure its targets are met, instead of waiting for market conditions to improve.

“It is the responsibility of companies and traders to fill the storage facilities for the winter,” a spokesperson for the German energy ministry told POLITICO. “Government-led filling of the storage facilities would further constrain the gas market and drive prices even higher. The supply situation over the coming months would actually deteriorate.”

Whether this is the right approach will become clearer by winter, said Laurent Ruseckas, a senior gas analyst at S&P Global. If temperatures are unseasonably low, traders may be forced to buy additional supplies at late notice, driving up prices, especially if the Strait of Hormuz remains closed. On the other hand, intervening could raise prices prematurely if winter turns out to be mild.

“If you start buying now to get storage to some politically predetermined level you’re making prices higher now to get insurance that you won’t get higher prices in the winter when it’s cold,” said Ruseckas.

Germany’s reluctance to move quickly also highlights the difficulty the EU’s fragmented energy sector has in competing with more centralized Asian economies that have acted more quickly to secure supplies, consistently outbidding European countries even as their reserves run low.

Others warn that physical supply strains are also possible. Heinermann, of INES, warned that even filling the country’s reserves to 76 percent of capacity — which SEFE says is achievable — would not necessarily meet its supply needs if winter is “exceptionally cold.” That could ripple out to neighboring countries to which Germany is treaty-bound to provide emergency gas assistance, including Austria, Switzerland, Italy and Denmark.

Heinermann called on the German government to encourage faster restocking by lowering network charges at storage facilities or abolishing the conversion levy, fees imposed for the conversion of gas on national grids. Berlin has already unveiled plans for a new emergency gas stockpile, but that will only cover 10 percent of the country’s gas capacity and kick off officially next summer.

It’s no surprise that other major gas consumers have already waded into the private sector. The Netherlands, another free-market champion suffering from low gas reserves, earlier this summer allocated €1.2 billion for its state energy company, EBN, to more swiftly top up its reserves. 

But Berlin’s energy giants are sticking to their guns — for now.

A spokesperson for SEFE told POLITICO that even though “international conflicts” could weigh on European storage levels, the 70 percent target “remains achievable” without intervention. He pointed out that 78 percent of German storage capacity has already been booked, though acknowledged that doesn’t necessarily translate to actual volumes of gas stored. 

Regulatory measures could be useful if “necessary” but could distort markets and increase costs, he added, without specifying what.

A Uniper spokesperson was less confident, warning it would be “increasingly challenging to reach the target storage levels before the winter season starts” at the current rate of filling. But she too stopped short of calling for intervention, arguing instead for better incentives for refilling — mirroring growing calls from gas lobbyists in Brussels to scrap the rules outright.

President Donald Trump on Thursday announced tariffs on polysilicon and its related products, in his administration’s latest attempt to eliminate China’s choke points in the global supply chain for solar panels and semiconductors.

But Trump’s directive won’t take effect until Dec. 4 — well after November’s midterm elections and a planned September summit between Trump and Chinese leader Xi Jinping — as the administration grapples with voters complaining of high prices and fragile trade negotiations with China.

“This will bring the supply chain here,” Commerce Secretary Howard Lutnick said of the order on Thursday alongside Trump at the White House. “We’ve got the industry here, it’s too small, and it’s going to explode.”

Because polysilicon is used in semiconductors and solar panels, it’s essential for military hardware and everyday electronics like cell phones and laptops, in addition to the world’s fastest-growing energy source.

The order imposes a 15 percent tariff on imported polysilicon and its derivatives, as well as minimum prices for imports of polysilicon, polysilicon ingots and wafers, solar cells and solar modules.

It also includes a clause intended to prevent companies from stockpiling those materials between now and December, authorizing Customs and Border Protection to restrict imports if it suspects an importer is attempting to dodge the higher duties.

Trump’s order is the result of a Commerce Department investigation launched last July into national security risks in the polysilicon supply chain, as part of a broader effort to shift supply chains away from China for multiple industries including wind turbines and robotics.

China has a near-monopoly on the production of polysilicon, according to S&P Global. But recent U.S. efforts to limit key areas of trade with China have already drawn a backlash from Beijing, which earlier this week implemented new controls on drone exports to the U.S.

The White House emphasized the order’s impact on domestic semiconductor production, a key focus as the U.S. looks to build out infrastructure related to artificial intelligence. Trump said the U.S. will “have a big percentage of the chip business by the time I leave office.”

But Thursday’s order may have a big impact on the solar industry, according to Jon Toomey, president of the pro-tariff Coalition for a Prosperous America organization.

“This proclamation delivers the most significant global trade protection action for the American polysilicon and solar industry in the modern era,” Toomey said in a statement. “For the first time, the United States is protecting the entire solar supply chain with a single action — and rewarding the manufacturers that build here — while taking a significant step to bolster the domestic semiconductor supply chain.”

Late last year, Department of Justice (DOJ) officials agreed to make a surprisingly damaging but until-recently little-noticed admission in court: the Trump administration had cancelled several grants worth at least hundreds of millions of dollars largely because the money was slated to be sent to states that did not support the president in the last election. 

“A primary reason” for withholding the funds in question was that “the grantee was located in a ‘Blue State,’” the DOJ wrote in a December 2025 court filing called a stipulation, an agreement entered into by the parties involved in a lawsuit agreeing to certain facts. 

A review by TPM identified multiple other instances of the administration making the same concession in court. One, from July, was recently covered by the New York Times; TPM found other examples of the same concession, documenting that the administration’s lawyers have been open for several months now about having withheld money in part or entirely to punish the president’s perceived political enemies.

BERLIN — A drone packed with explosives discovered at Leipzig Airport is raising fears of foreign interference in upcoming German regional elections in which far-right politicians have campaigned on fears of escalations with Moscow.

The drone — found at a strategic airport serving Ukrainian and NATO aircraft as well as a major DHL logistics hub — is being seen as evidence of a potential act by “foreign powers,” said German Interior Minister Alexander Dobrindt.

The Kremlin has been accused of seeking to sway September’s elections in Saxony-Anhalt and Mecklenburg–Western Pomerania, states in the former communist East Germany where pro-Russian sentiment remains strong and where the far-right Alternative for Germany (AfD) party could take power for the first time at the state level.

“We do of course see that Russia attempts every day, in one way or another — through hybrid means and various measures — to exert influence here in Germany in a manner that seeks to undermine our democracy and erode trust in politics and politicians,” said Martin Giese, a foreign ministry spokesperson.

Russian disinformation campaigns have portrayed German Chancellor Friedrich Merz and his government as warmongers. They aim to undermine the already unpopular chancellor and boost Russia-friendly forces such as the AfD and the far-left Sahra Wagenknecht Alliance (BSW) — both of which are strong in eastern Germany.

“The state elections in Saxony-Anhalt and in eastern Germany are, of course, a major target of Russian influence, because these are pivotal elections in the heart of Europe,” said Stefan Meister, a Russia expert at the German Council on Foreign Relations.

He said that it is too early to attribute the explosive-laden drone to Russia as investigations are still ongoing. But he added that Moscow is clearly waging a broad hybrid campaign targeting the region ahead of next month’s votes.

“This could be the first time right-wing populists come to power,” Meister said. “And with that, the chancellor might even fall — or at the very least, the coalition would be severely weakened — and a pro-Russian party would come to power in one of the federal states.”  

“There is a major campaign underway on the Russian side to influence these elections in favor of the AfD and the BSW,” he added. 

Polls show that the AfD has a chance of winning an outright majority in Saxony-Anhalt on Sept. 6 and is poised to be the largest party in Mecklenburg–Western Pomerania and is expected to perform well in Berlin when those states hold elections on Sept. 20.

Vulnerable transport hub

The drone incident risks raising fears in Germany that their country’s support for Ukraine is bringing the war closer to home.

The Leipzig-Halle airport has been a target in the past. In July 2024, an incendiary parcel caught fire at a DHL facility there shortly before it was due to be loaded onto an aircraft. European investigators later identified 22 suspects allegedly working for Russian military intelligence in the wider parcel plot. 

The airport is among Germany’s most strategically important transport hubs.

It is the home base for NATO’s SALIS airlift program, which gives nine participating countries access to Ukrainian Antonov aircraft capable of carrying oversized military cargo for national, EU and alliance missions.

The incident adds to a feeling of insecurity, which could help populist parties, said Meister.

“It’s once again obvious that we’re simply very vulnerable,” he said.

An interior ministry spokesperson said Wednesday that the government was monitoring a campaign it called “Matryoshka,” and regarded it as serious.

German officials said this week that fabricated videos that falsely accused candidates of corruption, sexual misconduct and other crimes appeared to have mimicked trusted outlets such as the German regional public broadcaster ARD and the U.K.’s BBC.

Independent researchers have gone further. Deutsche Welle counted more than 180 fake posts linked to Matryoshka targeting September’s three elections. The posts largely attacked candidates from centrist parties, while sparing the AfD and BSW, according to researchers.

Chris Lunday contributed to this report.

LONDON — Andy Burnham entered Downing Street with a promise to give hard-pressed voters “breathing space” on the cost of living. Now he must show he can deliver. 

At the top of his list is finding a way to reduce stubbornly high energy bills — even as the Iran-U.S. war forces up prices and ministers are under pressure to cut their own departmental budgets. The new prime minister knows any intervention must make a real impact for voters if he is to turn Labour’s fortunes around. 

“You need to make an emotional connection with people,” said one senior government official, granted anonymity to talk candidly about Whitehall thinking. 

Britain’s new prime minister has already made one bid to show voters he is serious about tackling the problem: Removing VAT from household electricity bills, something he announced on his first day in No. 10. 

The move will knock less than £4 off the average monthly bill, ends after one year, and comes with a price tag of £850 million. Downing Street said it will be paid for through so-far unspecified Whitehall savings. 

But Burnham and his new Energy Secretary, Miatta Fahnbulleh, promised that the intervention is just a start. Cutting VAT is a “down payment” ahead of the winter, Fahnbulleh said. 

That means ministers have just weeks before Burnham’s first budget this fall to figure out what, if anything, can really ease the burden — and how to pay for it. 

Salami slicing 

“The fiscal space is going to be a challenge, and that is the case for any government,” said Sam Alvis, associate director for environment, energy security, and nature at the Labour-aligned Institute for Public Policy Research think tank. 

That’s because any intervention to bring down energy bills will have to be funded from already under-pressure Whitehall departments. 

“This government is going to have a look at the budget. Whether it chooses to do some priorities differently — that is an open question,” Alvis said. 

One option for Burnham is to slice more charges from electricity bills, as he did with VAT. But any savings could be quickly wiped out if, as expected, the Middle East crisis pushes up wholesale gas prices.

Forecasters at Cornwall Insight predict that average annual household bills will rise by two percent this fall, even after the VAT intervention. 

That leaves Burnham facing the same problems as the man he replaced, Keir Starmer. 

Starmer cut £150 off yearly bills last November by shifting some so-called green levies, used to fund a clean energy scheme, onto general taxation. By the summer, that cut had been swallowed up by higher prices driven by the Strait of Hormuz crisis. 

Nonetheless, Alvis said, this approach remains Burnham’s most realistic option. 

“We are now in a bit of a scenario of salami slicing, where you’re aggregating lots and lots of smaller bits,” he said. “There’s no one big thing that you can do that’s going to take over £100 off bills. So, it’s about accumulating all those things that you think you could possibly do in one go, so it becomes sizable and noticeable.” 

Decisions, decisions 

One of those options, proposed by the think tank Nesta and reportedly being considered by Burnham, involves shifting further green levies from electricity bills onto tax.  

It identified another £42 of savings from a yearly bill, costing the Treasury £1.7 billion per year for a decade. 

Every small cut helps consumers, insists Andrew Sissons, Nesta’s director of sustainable futures. The think tank has also proposed knocking £22 a year off bills by shifting the standing charge on gas — currently a fixed daily fee — onto the unit rate, which changes depending on how much energy a home uses. That would take a year to implement and would not cost the government a penny, Nesta says. 

But such moves must be accompanied by larger interventions if voters are to feel the benefit, he added. 

“The amount you’d need to cut people’s energy bills … for it to feel like a real difference is quite substantial,” he said. The government, he argued, should aim for a “big package.”  

If the government aims for larger changes, they would come with even greater costs.  

Nesta has suggested a one-off move to wipe out electricity debt, removing some bailout costs currently funded through bills, taking total annual bill savings to £130. But the Treasury would have to find £2.7 billion to fund that. 

“[We] shouldn’t ignore the fact that there are fiscal trade-offs. But if the government wants to prioritize energy bills, then this is the kind of step it needs to take,” Sissons added, pointing to their proposed levy change alongside the VAT cut.  

Things take time  

Net-zero policies will, ministers hope, bring down bills for good. But large-scale changes take years to implement. 

“Realistically, the only way to deeply, deeply help people is to get them solar panels, is to get them an EV [electric vehicle], potentially heat pumps in some houses as well,” said Alvis. 

This is another reason to opt for “salami slicing”, he said: To “alter the balance of electricity and gas prices, so that those clean technologies stack up and save people even more money.”  

Alex Bevan, a research fellow at the Future Governance Forum, agreed that big savings attached to the shift to green energy were still a way off.  

“There aren’t quick workarounds on whichever form of energy you choose to generate and deploy,” he said. But government must nonetheless “lock in the benefits [of clean energy],” he argued. 

The same official quoted above stressed that no decision had yet been made on how the government would intervene on bills. Asked whether the government favored a series of small policies or one big intervention, they said: “It doesn’t have to be binary. … It doesn’t have to be one or the other.”  

A Department for Energy Security and Net Zero spokesperson said: “The energy secretary’s focus is bringing bills down for good. We will tackle the cost of living to make life’s essentials affordable again and bring back hope.”

For now, Alvis insisted, Burnham has one thing going for him: He can operate in the knowledge voters accept international issues are pushing up costs. 

“The political point I would make is: By doing your best effort, you give yourself the space to have a conversation with the public,” he said. 

Italy will use extra leeway from the EU to spend billions of euros on energy and defense, Finance Minister Giancarlo Giorgetti told members of the country’s parliament on Wednesday.

Rome is set to boost its expenditure on green energy and defense over the coming three years, said Giorgetti following a relaxation of rules from Brussels, which allows the additional spending to be exempted from the EU’s strict spending targets and waived from Rome’s deficit figures.

Italy is poised to issue a formal request to the European Commission — laying out the investments it intends to undertake with the extra flexibility — by a mid-August deadline.

Giorgetti said Italy will request to spend an additional 0.6 percent of gross domestic product on green energy investments and 0.9 percent on defense — the full amount that is envisaged under the new fiscal guidelines.

The additional defense spending will “include both new multi-year investment programs and proposals to reallocate resources already provided for under current legislation,” Giorgetti told MPs. Italy’s parliament is expected to approve Giorgetti’s request to the Commission on Wednesday.

The extra flexibility is aimed at reducing dependence on fossil fuels and moving toward NATO’s target to spend 5 percent of GDP on defense. With 2 percent of GDP allocated to defense in 2025, Italy is among the alliance’s spending laggards.

However, the decision to raise military spending is set to inflame political tensions within the country ahead of a crucial election year that will see incumbent Prime Minister Giorgia Meloni seek a second mandate.

The governing coalition is split on the issue, and the right-wing League party — from which Giorgetti himself hails — has repeatedly campaigned against spending more money to counter the Russian threat.

In a further constraint, the government is under heavy pressure from the right-wing, Russia-friendly National Future party led by former Gen. Roberto Vannacci, which is eating into support for the other governing parties, according to the polls.  

More leeway

In June, the Commission gave EU countries suffering from the ongoing energy crisis more fiscal breathing room by exempting some green investments from public spending rules.

The goal was to allow heavily indebted governments to mobilize resources for green expenditure, including subsidies for electric vehicles, geothermal and solar energy to reduce dependence on fossil fuels. Italy lobbied the EU to offer this concession after the war in the Middle East fueled a surge in oil prices.

However, Giorgetti failed to lay out which green investments will be included in Italy’s request to the Commission.

In another gaping omission, he did not reveal whether Italy will tap into the EU’s cheap loans for defense — another divisive issue within the government coalition.

Rome had initially earmarked €15 billion under the Security Action for Europe (SAFE) program, prompting defense companies to factor in those investments.

Italian Foreign Minister Antonio Tajani recently suggested that Rome will use the SAFE money, but said the exact amount will be decided later in the year.

Jacopo Barigazzi contributed to this report.

At this month’s NATO summit in Ankara, allies announced billions of dollars in new arms deals and reaffirmed their commitment to spend more on defense. European governments have made the pledge, and the money is real: European defense spending has doubled since 2019, and by 2030, European NATO member countries are projected to spend in excess of €800 billion a year, up €300 billion from 2025, with equipment spending alone nearly doubling.

But committing money is the easy part. The harder question is whether Europe’s defense industry can turn it into equipment fast enough to matter. Europe’s largest defense manufacturers’ order books now average more than five years for production, and some are closer to nine. Money is flowing in faster than industry can turn it into equipment. But a purchase order is not equipment that can be deployed on the ground and the air.

European countries have long duplicated capabilities rather than pooling them.

The bottleneck sits in the defense industrial system. Deterrence relies on the chain from funding to contracts, then through production, deployment into services, then rapid innovation in the field. Europe’s next goal comes after the spending promise. The continent fields six times as many weapons platforms as the United States, because countries have long duplicated capabilities rather than pooling them. Production ends up split across many small runs that never reach an efficient scale. Ukraine, under pressure, has shown how fast a defense system can move, adapting tactics in weeks and building drone detection networks from consumer electronics. Europe needs to catch up and then accelerate.

Four moves would help Europe accelerate.

The first is multi-speed procurement. Software-led systems such as drones and targeting improve in rapid cycles throughout their deployment and need procurement that can keep up. Israel’s Iron Dome started out as far less capable than it is today and improved continuously in service. European defense ministries have already set up high-speed procurement units with dedicated teams and greater risk tolerance. These need to become mainstream, rather than the exception.

Collaboration in procurement, maintenance and training brings costs down and delivery forward.

The second is military collaboration to reduce fragmentation. Collaboration in procurement, maintenance and training brings costs down and delivery forward. The Tempest project, where the U.K., Italy and Japan are jointly building a next-generation fighter, demonstrates the model: shared development costs that no single country could carry alone. Recent bilateral maritime agreements, and Romania’s use of EU funding to buy European while expanding production at home, show the same logic spreading.

The third is industrial consolidation, which is already underway and needs to move faster. Companies are driving it themselves. Airbus, Leonardo and Thales have agreed to merge their space divisions into a single joint venture with roughly €6.5 billion in revenue and 25,000 employees, and European defense mergers and acquisitions rose 35 percent year over year in the first half of 2025. McKinsey analysis finds that consolidation across key supply chain segments could unlock around €9 billion in annual synergies, more than the current equipment budgets of 24 of Europe’s 30 NATO members. The deepest opportunity sits below the big primes, among the thousands of tier two, three and four suppliers that still duplicate one another’s work. Europe can speed this up by harmonizing requirements, reducing national carve-outs and letting industry do the combining. Consolidation is only half the task. Europe also needs to build sheer capacity — more shipyards, more assembly lines, more of the physical plants that turn orders into hardware — and the capital to fund it. In several categories, Europe simply lacks enough places to build.

Real deterrence means difficult choices, and a public that understands the importance and the cost of security.

The fourth is regulatory unlocking. Full scale-up demands skilled workers retrained, accredited and security cleared from other industries; production sites with preapproved permitting; and alignment of export controls across European allies. These regulatory unlocks now need the same energy and focus as the funding commitment debate. 

Real deterrence means difficult choices, and a public that understands the importance and the cost of security. That conversation is only beginning in much of Europe. It must include the potential for “gray zone” cyber strikes on hospitals, arson at industrial sites, drones disrupting ports, undersea data cables cut — these have all occurred, but many citizens do not yet recognize this as having malicious intent.

The opportunity in getting it right is significant. McKinsey and GLOBSEC estimates indicate that every euro of spending on European-manufactured equipment generates two euros of revenue across the European supply chain, and an additional €165 billion a year in equipment spending could create up to 1.2 million jobs. The coming years will reveal how effectively Europe is able to scale up to protect its territory and citizens, and how much of the promised investment becomes lasting deterrence and European jobs. Getting there depends on the whole ecosystem — governments, industry and investors — moving together. Increased spending is important. Spending it effectively matters more.

Jonathan Dimson is a senior partner in McKinsey’s London office. Mikael Robertson is a senior partner in the Stockholm office.

When Iran shut down the Strait of Hormuz five months ago, experts predicted oil could spike to $150 or $200 a barrel. It has barely topped $100. According to Rogé Karma, writing in The Atlantic, the reason may be China, which abruptly cut its oil imports by half. — Read the rest

The post China cut its oil imports in half. No one knows why. appeared first on Boing Boing.

There was a backup plan for getting oil out of the Middle East. We may need another one.

 On July 20, the Iran-backed Yemeni rebel movement known as the Houthis declared a “blockade” against their long-time enemy Saudi Arabia, and a short time later attacked two Saudi oil tankers in the Red Sea. Shortly afterward, several ships carrying Saudi crude oil through the Red Sea made abrupt U-turns to avoid going near the Yemeni coast.  

With Iran now blocking shipping through the Strait of Hormuz, the Red Sea was supposed to be an alternative way to get oil out of the Middle East and to the world market. Now, though, the importance of the route has merely created fresh leverage in the long-simmering conflict between the Houthis and their longtime enemies in Saudi Arabia. These attacks were a major factor in pushing oil back over $100 a barrel last week.  

The Houthis have their own agenda partly unrelated to the Iran conflict. But in launching the Iran conflict, the US has inadvertently given them outsized influence in the region: The sea lane they control is more important than ever. Now, in opening up a new front, they may have just made the war harder to end. 

The Red Sea has become increasingly important to Saudi Arabia and energy markets as shippers have avoided Hormuz in recent months. Saudi Arabia has diverted around 70 percent of its oil exports via a pipeline connecting the oil fields on the Persian Gulf to the port of Yanbu on its Red Sea coast. This means that tankers need to use the Red Sea to get oil to Asia. As a result, the Red Sea now accounts for around 7 percent of the world’s energy supplies. 

This release valve is one reason why the price of oil — and the price of gas for American drivers — has not risen as much as many experts expected when the Hormuz crisis began shortly after the US-Israel strikes on Iran. 

But now, that release valve is also under threat, putting the region and the world in what shipping experts call a “double chokehold.”

The Houthis have used their location to cause chaos before: In 2023 and 2024, they attacked over 100 ships they accused of links to Israel, and dramatically drove down shipping through the Red Sea. Those attacks stopped after the Israel-Hamas ceasefire last year, but shipping has still not fully recovered. 

President Donald Trump has threatened both the Houthis and Iran with “major military punishment” over the attacks in recent days. And the attacks also make it likelier that the conflict in Iran could make oil pricier than ever, increasing political pressure on Trump. 

What do the Houthis want? 

The Houthis are a member of Iran’s network of regional proxies, known as the “Axis of Resistance,” along with Hezbollah, Hamas, and a number of Iraqi militias. But most experts believe that while they rely on Iranian support, they operate independently and don’t take their marching orders from Tehran. 

Officially known as Ansar Allah, the Houthis are members of the minority Zaydi sect of Shia Islam. They’ve been fighting for control of Yemen since the 1990s and took over Yemen’s capital city, Sanaa, in 2014, though most countries do not recognize them as Yemen’s legitimate government. 

The Houthis fought a brutal decade-long war against Yemen’s internationally recognized government and an international coalition led by Saudi Arabia, which ended with a UN-mediated ceasefire in 2022. 

The Saudi-Houthi peace has largely held since then, even as the Houthis gained global notoriety during the Gaza war. When this year’s war began, many expected the Houthis to join the fight against Iran’s enemies, the United States and Israel, but for the first few weeks of the conflict, they were conspicuously quiet. Their impact was felt in a different way, though. 

Iran’s success in using cheap drones and missiles to effectively shut down the Strait of Hormuz almost certainly drew on lessons gained from the Houthi campaign in the Red Sea in 2023 and 2024.

In March, the Houthis made their first move toward actively joining the Iran war when they launched a round of missiles at Israel. But things really escalated in mid-July when they began launching attacks on Saudi Arabia in response to an attack on the Sanaa airport, which they blamed on the Saudis. (The initial attack was claimed by Yemen’s internationally-backed government.)

In addition to the Red Sea attacks, the Houthis also claimed an attack on a Saudi oil refinery last Saturday, the group’s first attack on Saudi energy infrastructure since 2022, followed by attacks on oil depots along the Red Sea coast on Sunday. Several Iran-backed militias in Iraq also carried out their own attacks on Saudi Arabia over the past few days. 

The Houthis have now entered the conflict, but it would be a mistake to view them just as Iranian proxies. They have their own demands and agenda in this fight. 

“When the whole Iran war started, they were kind of observing and waiting for the right moment,” said Mohammed al-Basha, a US-based security analyst and Yemen expert. Basha suspects that the Houthis saw the leverage and concessions Iran had gained throughout the region and wanted to exert some leverage of their own. “Their aggressiveness went from zero to 60 last week,” he said. “They’re all in.”

All in for what, exactly? The Houthis’ demands from the Saudis include billions in reparations payments and full control of their coastline and airspace. In the long term, they aim to be Yemen’s internationally recognized government. 

The Saudis, then, who fought a brutal and unpopular war against the Houthis that ended in a stalemate, are faced with the unappealing choice between placating the group by agreeing to its demands or a return to war. 

What about the US? The US carried out more than 1,000 airstrikes over 52 days against the Houthis in 2025. While this campaign, known as Operation Rough Rider, caused significant damage to the group’s infrastructure, it did not succeed in fully restoring shipping in the Red Sea. 

Trump has threatened retaliation, but given concerns over munitions stockpiles, the US capacity to retaliate, much less expand this war to a new front, is probably limited.

How many chokeholds is too many?

For the moment, the Bab el-Mandeb is not completely closed — shipping is down around 22 percent since the blockade was declared, but 28 ships were able to transit the strait on Monday. The Houthis maintain that their blockade targets only Saudi Arabia, but Chinese supertankers have been allowed to leave the Red Sea carrying Saudi oil.  

But shippers recall that during the Houthis’ last Red Sea campaign in 2024, they were theoretically only targeting ships linked to Israel, but had a pretty broad definition of “linked to Israel.”  Under these circumstances, many shippers, and more importantly their insurers, might not want to take the risk. 

“We’ve seen what the Houthis can do,” said Noam Raydan, an expert on energy and maritime shipping at the Washington Institute for Near East Policy. “We know that they can sink ships. We know that they can hit a ship with drones, missiles, and then even board the ship. We know that they can hijack a vessel. This is why a lot of operators, in my opinion, would really be hesitant right now to go through the Bab al-Mandab.” 

There’s also still the risk that this new front in the war could escalate. Iran’s government has asked the Houthis to shut the Bab el-Mandeb entirely if the US launches airstrikes against Iran’s power network, which Trump has repeatedly threatened to do.

This adds a new complicating factor to the larger conflict in the Middle East. The fact that the price of oil never rose as high as many experts had predicted during Operation Epic Fury, the initial strikes in the spring and early summer, is probably one reason why Trump has often seemed willing to continue the conflict, rather than cutting a quick deal on Iran’s terms. But Saudi Arabia’s access to the Red Sea is one important reason why oil has not reached $120 or even $200 a barrel. A full closure of the Bab el-Mandeb would test even the ever-adaptable global oil industry’s ability to adapt.

It’s possible the Saudis may still be able to cut a deal with the Houthis that ends the attacks. But it’s also clear that for the foreseeable future, two of the Middle East’s most important energy chokepoints are going to be under continual threat of closure by adversaries of the United States. 

For now, oil can still leave the Red Sea via the Suez Canal at its northern end, then head toward Asia around the southern tip of Africa. (Since the largest tankers aren’t able to transit the Suez while fully loaded, this is a complicated process that involves them pumping their oil into a pipeline, then meeting it at the other end in the Mediterranean.) 

“It just gets harder and harder,” said Robin Mills, CEO of the Dubai-based energy analysis firm Qamar Energy. “Can they get all of the oil from Yanbu out through the Suez? I think they probably can but it’s a little bit tight. If [the Houthi campaign] were to expand, it becomes more of a problem.” 

The Suez Canal itself is also a potential target for disruption or sabotage, retired US Adm. James Stavridis recently warned. 

The disruptions at sea will increase interest in workaround projects such as a proposed pipeline from Iraq to Turkey, bypassing sea routes entirely, but these are still a long way off. The Houthis and their allies in Iraq also demonstrated this week that they can attack oil infrastructure and pipelines in addition to ships. 

The oil and shipping industries are nothing if not adaptable. Previous disruptions, whether the tanker that ran aground in Suez in 2021, the container ship pileups caused by the Covid-19 pandemic, or the Houthis’ previous Red Sea campaign, have been temporary. Goods eventually find their way to market, even if that means another month sailing around Africa.

But as the number of armed conflicts grow, and actors like the Houthis and Iran learn how to effectively weaponize the global economy’s chokepoints to punish much larger and more powerful adversaries, the stresses on the system are growing, and the question becomes whether there’s a breaking point.