A more polarized parliament could make it difficult to pass EU legislation on issues ranging from climate and immigration to industrial strategy and defense.
The Parliament has, in the past, been led by a strong majority of centrist parties, who typically vote together on issues to win a majority in the 720 seat chamber. Indeed, the center-right European People's Party is once again projected to win the most parliamentary seats and retain its dominance in the chamber.
Armida van Rij, a senior research fellow for the Europe Programme at the Chatham House thinktank who was speaking before the results, told CNBC that the influence of the far right was "already being felt" in the EU, but that it could result in further policy shifts and "back pedaling" in the new Parliament.
Enacting the "Green Deal" — the EU's flagship carbon neutrality program — is now at "real risk," according to van Rij, with Parliament having already watered down some legislation to appease the right.earlier this year. Meanwhile, plans to implement a ban on the sale of new internal combustion engine vehicles by 2035 could also be scrapped, the analysts said.
Nevertheless, the issue of European defense — and how it is funded — will be a hot topic, particularly amid talk of a shared EU defense budget. "The incoming Commission and Parliament are likely to continue the trend towards greater protectionism and intervention in strategic industries, although the EU will remain an open, trade-dependent economy," they wrote.Elsewhere, enlargement of the EU could face further setbacks with a larger euroskeptic presence in Parliament.