Europe Intelligence Brief — Sunday, August 23, 2026

Europe's capitals are drafting a windfall tax on oil profits amidst a weekend of crises. Germany, Italy, Austria, Poland, and Portugal, through their finance ministers, and Spain through its economy minister, want finance ministers to consider this levy during an informal meeting in Dublin. The proposal aims to shift the cost of inflated oil company profits from households to producers.

However, given the poor track record of such measures, governments are reaching for this tool due to budget pressure. Germany's finance minister backs the levy, while Chancellor Merz's Christian Democrats oppose it. Meanwhile, a fire at the Hürtgen Forest site drew boos from Merz during his first public engagement of the summer holiday.

Europe is also grappling with drought and floods, exposing unexploded munitions and warships. Poland faced flooding and evacuations, while Italy and Spain rejected Morocco's call for talks on the sovereignty of Ceuta and Melilla after a deadly crossing. France and Spain declined to join Hungary's migrants' return to Italy, while Sweden plans to continue returning migrants before its election.

France authorized preparatory works for new reactors, while Romania advanced plans for a large solar installation. These arguments will be settled by the party with the least ability to refuse.