Energy prices have been a major political concern in Europe in recent years, largely because of the conflict in Ukraine, which is now into its fourth year.

The European Council, which includes the European Union's individual heads of government among its members, will have its next regular meeting on March 19.

European Commission President Ursula von der Leyen said that tactics to deal with the latest price volatility would be on the agenda.

Italian Prime Minister Giorgia Meloni has vowed to punish anyone found to be profiteering.

"I am very determined to do what I can to prevent speculators from exploiting the crisis at the expense of families and businesses," she said.

"I am ready to react, if necessary, even by raising taxes on companies that may speculate on prices through energy bills."

In France, authorities have been carrying out price checks at gas stations across the country to ensure suppliers are not cashing in, and the United Kingdom's finance minister, Chancellor of the Exchequer Rachel Reeves, has warned of the potential impact of the war on the domestic cost-of-living crisis.

Comments by the United States that the Iran conflict could be over sooner rather than later caused the price of oil to fall and the return of some stability to stock markets on Tuesday, after a period of economic volatility caused by fears of prolonged turmoil in the Gulf region.

The future of the vital Strait of Hormuz supply channel is still unclear as it has largely been shut down, but Washington's comments that the war is "very complete, pretty much", saw the price of a barrel of Brent crude oil fall to below $90 on Tuesday, having risen as high as $118 on Monday.

The London Stock Exchange's FTSE 100 opened up 0.5 percent on Tuesday, rebounding from a 1.8 percent decline in value on Monday — another indication that economic tensions are easing.

However, at the same time as Washington was suggesting the war could soon be over, the X account of the Defense Department said, without any context, "We have only just begun to fight." As recently as Friday, in a television interview, Defense Secretary Pete Hegseth also said "this is only just the beginning".

Nigel Green, chief executive of the deVere consultancy group, told Sky News that markets were already looking beyond the end of the conflict.

"Oil dropping back below $90 and equities pushing higher tells us investors are already pricing a scenario in which tensions cool and supply disruptions remain limited …in situations like this, (markets) can move ahead of geopolitical reality," he said.