Switzerland faces higher energy costs as winter gas risks mount

Europe is entering the winter heating season with gas storage levels running low, while the Strait of Hormuz remains disrupted by the US-Iran conflict. Switzerland has continued to receive petrol, diesel and heating oil, yet the conditions around Europe’s energy market have become more costly and less forgiving.

The immediate concern for Swiss households and businesses is a price shock. Switzerland buys most refined fuel from European Union countries, linking domestic prices to regional supply, freight and wholesale markets. Any competition for limited gas or fuel cargoes could raise costs even when Swiss filling stations remain supplied.

That exposure is sharpening as summer ends. Brent crude stood at about $90 per barrel, around 25% above its pre-war level. European diesel prices have climbed by more than 70% since the conflict began. The pressure is already visible in Switzerland, where diesel averaged CHF 2.27 per litre in late August and unleaded petrol reached CHF 2.02.

The figures point to a supply system that is functioning, but at a higher cost. Winter demand will test how much room European markets have to absorb another disruption.

Swiss fuel importers report secure deliveries, and the country has not released its emergency reserves during the conflict. Avenergy spokesperson Ueli Bamert told Swissinfo that supplies had remained guaranteed throughout the previous six months.

Switzerland’s import profile has helped limit its direct exposure to the Gulf. About 30% of Swiss oil imports arrive as crude, mainly from the United States, Nigeria and North Africa. Most refined petrol and diesel come from EU countries, where traders and transport networks remain connected to the wider European market.

The federal system also provides a buffer. Mandatory stockpiles held by private companies under government supervision can cover around four and a half months of petrol, diesel and heating oil consumption. Kerosene reserves cover about three months. The government did not draw on those stocks during the first six months of the war.

Those reserves protect against a sudden physical shortage. They do not shield consumers from wholesale price increases, higher shipping costs or a prolonged squeeze on European supplies. Swiss motorists can therefore expect market volatility to reach them through prices before it appears as empty pumps.

Swiss drivers are already paying more at the pump, and transport costs are feeding pressure through the wider economy. Diesel prices rose 21% between late February and late August, while unleaded petrol increased 17%. The change affects commuters, farmers, delivery firms and companies that depend on road freight.

The Geneva-based International Road Transport Union estimates that road freight costs in Switzerland are 15% higher than a year ago. The organisation expects costs to remain elevated until the end of 2026. Fuel is one factor, alongside the wider expense of moving goods through a market affected by disrupted energy routes.

Heating oil adds a direct household burden. The price rose from about CHF 92 to CHF 156 per 100 litres in April, then eased before climbing again to roughly CHF 140 in late August. Heating oil remains the primary heating source for about 35% of Swiss buildings, according to the Federal Statistical Office.

Low water levels on the Rhine have compounded the problem. Reduced navigation has disrupted petroleum deliveries from North Sea ports to Basel, raising transport costs for products moving into northern Switzerland.

Low European gas storage leaves Switzerland exposed to a regional squeeze as winter demand approaches. The country’s gas market is closely tied to neighbouring systems, and Swiss buyers compete within the same European network for imported supplies. Disruption around the Strait of Hormuz adds uncertainty to global energy flows, including liquefied natural gas cargoes that can influence European prices.

The consequences would reach beyond gas-fired heating. Higher gas prices can raise the operating costs of utilities, manufacturers and service companies. Businesses may pass those costs into goods and transport, while municipalities and households face more expensive heating contracts as they plan for colder months.

Switzerland’s position differs by region and energy source. Heating oil remains common in many buildings, particularly outside dense urban areas. Gas networks serve other households and businesses, while electricity demand can rise when consumers switch heating systems or seek alternatives. The result is a broad exposure to energy prices rather than a single national supply point.

The available information does not indicate an immediate Swiss gas shortage. It does show that low storage across Europe could make the winter market more expensive and reduce the margin for handling a sudden cold spell or further international disruption.

Swiss households and companies are heading into winter with functioning supplies, higher bills and less certainty about the European market. The government’s compulsory stocks provide time to respond to a severe interruption, while Switzerland’s diverse crude suppliers have reduced its direct dependence on Gulf oil.

Market exposure remains the more immediate issue. Petrol, diesel and heating oil prices have all risen since the conflict began. European diesel has increased by more than 70%, Swiss road freight costs are 15% higher than a year ago, and low Rhine levels have added a logistical constraint around Basel. These pressures can persist even when imports continue normally.

Gas presents a separate winter risk. Low EU storage levels leave less flexibility if temperatures fall sharply, industrial demand rises or the Hormuz disruption lasts. Switzerland will feel those conditions through European wholesale prices and cross-border supply arrangements.

Consumers, property owners and businesses are likely to watch fuel and heating markets closely as autumn approaches. The key indicators will be European storage levels, shipping conditions, Rhine water levels and the stability of refined fuel deliveries from neighbouring countries. For now, Switzerland has reserves and supplies. The cost of maintaining that security is rising.