War, Pressure and Policy: Europe’s Gradual Turn on Israel

In recent years, European perceptions of Israel have undergone a noticeable shift, driven primarily by the war on Gaza following the events of 7 October 2023. What began as growing unease has gradually translated into a marked decline in public favourability across Europe, with many viewing Israel’s military response as disproportionately severe. This transformation in public sentiment, however, has not been immediately mirrored at the political level. European leaders have largely maintained a cautious and diplomatic posture, continuing to balance expressions of concern with longstanding commitments to “Israel’s right to self-defence”. That stance has begun to erode more recently. The regional escalation involving Iran has introduced direct economic and strategic pressures on Europe, prompting a more assertive, albeit still measured, response from policymakers. At the same time, political changes within Europe, including the emergence of leaders less firmly aligned with Israel, such as Hungary’s Prime Minister Péter Magyar, signal a gradual recalibration rather than a sudden rupture in policy.

This evolving landscape became particularly visible in late April 2026, when discussions emerged within the European Union around suspending the EU–Israel Association Agreement. Although the proposal did not advance, with key member states such as Germany and Italy blocking consensus, it nonetheless highlighted the extent to which previously unthinkable measures are now part of the policy debate. While the suspension of the agreement would carry significant economic consequences for Israel, its implementation remains constrained by the European Union’s (EU) internal political dynamics. Yet the inability to pursue this option does not imply a lack of leverage. The European Union retains a range of alternative instruments that can be deployed to exert pressure on Israel.

European perceptions of Israel are now at their lowest point since the establishment of the state in the late 1940s, reflecting a clear and sustained shift in the political and societal climate across the continent. Public opinion began to turn during the war on Gaza, which many Europeans viewed as disproportionately severe, prompting a reassessment of long-standing positions towards Israel. Over time, this has translated into a broader decline in favourability, indicating that the shift is not temporary but part of a deeper transformation in attitudes.

However, the evolution of political leadership has not fully mirrored this societal change. For much of the past year, most European leaders maintained a familiar, cautious line, expressing concern over Israeli actions while consistently reiterating Israel’s right to defend itself. This rhetorical balance, which had defined European diplomacy for decades, began to fracture only more recently. A small number of leaders, most notably Spain’s Prime Minister Pedro Sánchez, departed earlier from this pattern, but the majority remained aligned with traditional positions until a more direct trigger emerged. That trigger came with the escalation involving Iran. Unlike the war on Gaza, which primarily reshaped public opinion, the broader regional confrontation began to affect European strategic and economic interests more directly. This distinction is critical. While public sentiment was driven by humanitarian and moral considerations, leadership responses appear to have been catalysed by tangible pressures on stability, energy security and economic resilience. In this sense, the shift among European leaders suggests that policy change is more closely tied to material interests than to public values alone.

It is then triggered by the economic dimension of the crisis which has been particularly influential. Energy markets reacted sharply to the conflict, with oil prices rising from around $72–$73 per barrel before the escalation to nearly $120 at their peak, before settling at approximately $93 following the ceasefire. Gas prices followed a similar trajectory, increasing from roughly €35.5 per MWh to peaks above €60, before stabilising closer to €44. Although Europe imports only a limited share of its energy directly through the Strait of Hormuz, its broader dependence on global energy markets exposes it to price volatility. Given that oil is traded in U.S. dollars, currency fluctuations have further amplified costs, placing additional pressure on European economies and consumers. These economic repercussions have extended beyond energy into sectors such as aviation. Rising jet fuel costs and supply constraints have already begun to disrupt operations, with airlines adjusting prices and, in some cases, cancelling flights ahead of peak travel periods. Such developments reinforce the perception among European policymakers that regional instability carries immediate domestic consequences, thereby accelerating the need to reassess foreign policy positions.

Alongside, political shifts within Europe also point to a gradual recalibration. In Hungary, the election of Prime Minister Péter Magyar signals a more nuanced approach compared to the unequivocal pro-Israel stance of his predecessor. While maintaining that Israel remains an important economic partner, Magyar has indicated that future EU decisions will be assessed on a case-by-case basis rather than automatically blocked. His position on re-engaging with international legal frameworks further suggests an attempt to realign Hungary more closely with broader European norms, rather than pursuing the isolationist trajectory seen previously.

At the same time, regional tensions have contributed to a widening political gap. European reactions to Israeli strikes in Lebanon, particularly in countries such as France and Belgium, have been markedly more critical, reflecting growing discomfort within European capitals. This indicates that the shift is not confined to economic considerations alone, but is increasingly reinforced by geopolitical developments that challenge existing diplomatic balances.

Taken together, these dynamics reveal a two-track transformation. European public opinion shifted first, driven by the war on Gaza and its humanitarian implications. Political leadership followed later, responding to the strategic and economic fallout of a broader regional escalation. The result is a gradual but discernible reorientation of Europe’s stance towards Israel, shaped less by a sudden break and more by the cumulative effect of societal pressure, economic vulnerability and geopolitical recalibration.

Many Israelis increasingly view the European Union as a declining force on the global stage, and consequently no longer a central partner for Israel. Strategic attention has shifted more decisively towards the United States, which remains Israel’s strongest ally and is widely perceived as the only external actor capable of exerting meaningful influence over Israeli policy. Within Israeli policy circles, there is a growing belief that divergences with the EU, particularly on the Palestinian issue, are likely to deepen rather than narrow. As a result, expectations for any near-term improvement in Israel–EU relations remain low, with some advocating a pivot towards alternative partnerships, especially with emerging powers and Asian economies such as China. At the same time, this perspective is not uniform across the Israeli political spectrum. Opposition figures have increasingly acknowledged the importance of maintaining and potentially improving relations with Europe. This reflects a more pragmatic assessment of the EU’s enduring weight, not only as a global actor but also as a key economic partner. For Israel, which operates within a security doctrine shaped by recurrent and often overlapping conflicts, from Gaza and Lebanon to Iran and Syria, sustaining diverse external partnerships is not optional but necessary. The cumulative economic burden of these conflicts reinforces the importance of maintaining stable relations with actors that hold financial and trade significance, including the EU.

In terms of policy direction, Israel may continue to rely on a familiar approach that seeks to manage, rather than fully repair, its relationship with Europe. This has historically involved exploiting divisions within the EU to prevent the emergence of a unified position on issues concerning Israel. Such a strategy has, at times, proved effective in slowing or diluting European decision-making. A notable example is the absence of formal conclusions by the EU’s Foreign Affairs Council on the Middle East Peace Process since June 2016, a departure from previous practice. However, the sustainability of this approach is increasingly uncertain. Shifts within European politics, including leadership changes in countries that were previously more aligned with Israel’s positions, raise questions about whether reliable allies within the EU will remain. This suggests that while Israel may attempt to continue leveraging internal European divisions, it may also need to reconsider its broader approach and explore more constructive engagement if it seeks to preserve its long-term strategic and economic interests in Europe.

The EU retains substantial leverage in its relationship with Israel, even if the suspension of the EU–Israel Association Agreement remains politically difficult to achieve. Entering into force in 2000, the agreement forms the backbone of bilateral relations, granting Israel preferential access to European markets while structuring cooperation across trade, research and diplomacy. It is also anchored in a human rights clause, which has been central to recent discussions within the EU on whether the agreement should be suspended. Despite proposals from some member states, these efforts have not translated into action, largely due to political divisions within the Union as Germany and Itally halted the proposal on the 21st of April.From an economic perspective, the agreement represents one of Europe’s most powerful tools. The EU is Israel’s first trading partner, accounting with 32% of the latter’s total trade in goods in 2024, with exports to the European market estimated at €17–20 billion annually.

Any suspension would remove tariff-free access and reintroduce customs duties, typically ranging between 2% and 10% for industrial goods and potentially higher for agricultural products. Even a moderate average tariff of 5% could impose an additional cost of close to €900 million per year on Israeli exports. More significantly, the erosion of regulatory alignment would likely introduce non-tariff barriers, including stricter certification requirements and supply chain delays, increasing overall trade costs by an additional 5%–15%. In combination, these pressures could reduce Israeli exports to the EU by 10%–20%, equivalent to losses of approximately €2–4 billion annually. Beyond exports, Israel would also face higher import costs for European machinery, vehicles and industrial inputs, feeding into domestic price pressures and production costs.

However, the deployment of this leverage is constrained by institutional realities. A full suspension of the agreement requires unanimity among all 27 EU member states, which remains highly unlikely given entrenched political differences shaped by national histories and strategic preferences. Even a partial suspension targeting commercial arrangements requires a qualified majority representing at least 65% of the EU population, effectively granting heavily populated states significant blocking power. These procedural barriers explain why, despite growing pressure, the EU has not moved beyond discussion. That said, the EU is not limited to this single instrument. It possesses a range of alternative options that, while less dramatic, can still exert meaningful pressure on Israel:

• Targeted sanctions on individuals

Under the Common Foreign and Security Policy framework, the EU can impose sanctions on specific individuals rather than the state. These measures include asset freezes within EU jurisdictions, travel bans and prohibitions on conducting business with EU-based entities. This approach has already been applied to Israeli settlers and actors linked to violence in the West Bank. However, Israel falls within the category of “low-intensity regimes”, comprising countries with the smallest number of individuals sanctioned by the EU. This grouping notably includes France itself, a founding member of the Union, underscoring the limited scale of such designations. Israeli nationals account for only around 0.02% of the total number of sanctioned individuals/entities. At the same time, it is important to note that EU sanctions targeting Israelis were only introduced in 2024, suggesting early, baby steps that may indicate a gradual, albeit still limited, shift in European policy.

While expanding sanctions to higher-level officials, including influential political figures, would face political resistance and still require unanimity, it remains a more flexible and less economically disruptive tool than broad trade measures.

• Trade and regulatory pressure short of suspension

Even without fully suspending the agreement, the EU can tighten regulatory scrutiny, delay certifications or introduce administrative frictions that raise the cost of market access. Given the scale of Israel’s reliance on European trade, even marginal increases in friction can have cumulative economic effects, particularly in high-value sectors such as pharmaceuticals, chemicals and advanced manufacturing.

• Research and innovation leverage

Israel’s participation in EU-funded programmes, particularly under the Horizon framework, and the Erasmus + programs provides access to significant financial resources, estimated at over €1 billion through to 2027, as well as integration into European research networks. Conditioning or restricting this participation would not only carry financial implications but could also affect Israel’s technological ecosystem, especially in sectors with dual-use applications.

• Visa and mobility restrictions

Recent changes to EU regulations now allow the suspension of visa-free travel on the basis of human rights concerns. While this mechanism has rarely been used, it opens the possibility of requiring visas for Israeli citizens travelling to the Schengen area. Such a move would carry both symbolic weight and practical consequences, particularly for business, academic and political exchanges.

In this context, the EU’s leverage is best understood as layered rather than singular. While the suspension of the Association Agreement represents the most consequential measure, it is not the only pathway. The Union retains the capacity to apply pressure through a combination of economic, regulatory and political tools. The central challenge lies not in the absence of mechanisms, but in aligning member states around their use.

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