The EU’s finance commissioner chief has sparked fury by comparing the bloc’s reliance on the City of London to its dependence on Russian oil and gas.

Clearing houses act as middlemen in derivatives trades between banks and have become a key part of the financial system since the 2008 financial crisis.

Banks and money managers on the Continent have long cleared their trades in London, and have been allowed to continue doing so until June 2025 despite Brexit.

Mairead McGuinness, the commissioner for financial services, said: “It’s time now for Europe, the EU of 27, to make very strong decisions on the financial stability and the financial system, just as we are doing today very critically and very urgently around our over-dependency on energy from Russia.”

Ms McGuinness added: “We do need to watch out for areas where we are vulnerable to decisions made outside the EU, and therefore, beyond our control.

“Energy is the most prominent and urgent example of that vulnerability right now. But we also need to watch for vulnerabilities in capital and financial services.”

Andy Mayer from the Institute of Economic Affairs, a think tank in London, said: “The commissioner’s crass comparison between an ally and a hostile power engaging in an illegal war on European soil is deeply regrettable.

“The EU would do better to focus on reducing barriers to trade to reduce their exposure to any single trading partner, including the UK.”

Ms McGuinness told a European Central Bank event on Wednesday that she will propose new legislation in October. This could include incentives for using clearing services in the bloc and disincentives, such as charges, for those in London.

Pension funds and public entities could be required to stick to EU houses.

LCH, the London Stock Exchange’s clearing arm, handles around 90pc of euro interest rate derivatives, a contract widely used by companies in the bloc.

Brussels and the European Central Bank have long pressured for a move from the City to Frankfurt but it is yet to happen.

Earlier this year, Ms McGuinness allowed UK firms to continue providing clearing services to the EU after failing to convince them to shift business to the continent.

The extension was seen as an acknowledgment by the bloc of the Square Mile’s crucial role in the health of European business and finance.