Bruno Le Maire, the French finance minister, said households faced rises in electricity prices of up to 40pc “if we don’t find a solution in the coming days”.
“It is an absolute emergency because the explosion in electricity prices is neither sustainable for households nor for businesses,” he warned.
His German counterpart, Christian Lindner, is also ready to intervene while Poland has cut VAT on petrol and diesel from next week after inflation rose to a 21-year high of 8.6pc.
The inflation spike comes alongside a likely hit to growth as the omicron variant sweeps across Europe, forcing new restrictions and even a full lockdown in the Netherlands. Consumer confidence across the eurozone also sank to its lowest since May last month.
Fabio Balboni, senior economist at HSBC, said tensions with Russia were likely to draw out the inflation pain due to higher energy prices.
“The market is now expecting wholesale gas prices to stay high until the spring of 2023 rather than this spring,” he said.
“If it is right, that means inflation could also remain well above the ECB’s 2pc target for a longer period of time than we had anticipated, putting further upside risks on inflation this year.”