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(Bloomberg) — The Netherlands has allocated more than €950 million ($1.1 billion) to blunt the Iran war’s economic effects on Dutch households and businesses, as it prepares for possible fuel shortages.
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The package includes a higher tax-free travel allowance for employees and €195 million to help the poorest households pay their energy bills, according to a letter that the finance, economy and climate ministers sent to parliament.
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The move reflects the mounting Dutch anxiety over economic fallout from the US-Israeli war with Iran. The conflict prompted Tehran to shut down the Strait of Hormuz, a vital passageway for oil and gas, spiking Europe’s energy costs and restricting supplies.
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The Dutch government is “taking into account a further deterioration of the situation and is preparing for it,” Finance Minister Eelco Heinen told reporters in The Hague on Monday.
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Although there are no acute oil shortages yet in the Netherlands, the government also launched the first phase of its so-called national oil crisis plan on Monday. This marks the first time the plan has been activated since it was created in 2022, following Russia’s full-scale invasion of Ukraine.
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The initial phase mainly consists of consulting with energy-intensive industries and closely monitoring fuel reserves, while mapping out possible future options like strategic fuel saving and tapping oil reserves. If the scarcity worses, the government could eventually restrict fossil fuel use.
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The move adds to measures being taken across the European Union. Germany recently said it would reduce a gas tax, and the European Commission, the EU’s executive arm, is set to intervene in the jet fuel market to avoid severe shortages, according to a draft document seen by Bloomberg.
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Heinen told Bloomberg that he had discussed the matter with his European counterparts and called Germany’s decision to lower fuel taxes “not the wisest measure, because if one member state does so, that heightens the pressure on the other member states to do so as well.”
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Heinen said that’s why he opted instead for measures like the tax-free travel allowance.
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