Germany advised to lift fracking ban over Iran energy crisis

Germany should consider allowing fracking to bring down energy prices and reduce dependencies highlighted by the war in Iran, according to a group of advisers to Economy Minister Katherina Reiche.

In a brief report released on Friday, the four economists take stock of the impact of the US-Israeli campaign in the Middle East on Europe and issue recommendations for a potential response, including to the shock to the oil market.

"One option would be to allow gas extraction, for example through fracking, and to seriously consider reducing dependence on foreign suppliers," they wrote.

Such a step would also send a signal to domestic industry that the government is committed to security of supply, wrote economist Veronika Grimm, who is also a member of the official Council of Economic Experts that advises the German government.

Fracking refers to a technique of extracting natural gas and oil from deep underground rock formations by injecting a fluid, for example water, at high pressure to fracture the rock and allow the fossil fuel to escape.

Fracking has been banned in Germany since 2017 due to its environmental risks, with the country's environment agency highlighting a potential chemical contamination of groundwater.

But Reiche's economic advisers argue that the risks of fracking can be significantly minimized, citing a parliamentary commission of experts.

German soil contains between 320 billion and 2,030 billion cubic metres (bcm) of natural gas, according to the report, citing further experts.

Meanwhile, the country imported around 11 bcm of liquefied natural gas from the US last year, it said.