IMF warns EU not to shield consumers and businesses from energy price spike 

Government intervention should focus on lump-sum transfers to the poorest households, International Monetary Fund says

Fuel protestors in Dublin last Sunday: The IMF warns tax cuts on fuel distorts signal to cut consumption.

European governments should not excessively shield businesses and consumers from more expensive energy because that distorts the price signal to cut consumption and could be fiscally very expensive, the International Monetary Fund said.

Europe's ​heavy reliance on oil and gas imports has left it exposed to spiralling prices ⁠since the Strait of Hormuz, a vital global oil and gas shipping route, was closed as a result of the US-Israeli attacks on Iran and Tehran attacking energy infrastructure in the Middle East.