EU Officials Project Higher Oil and Gas Prices Through 2027

European Union officials said Friday that oil and gas prices in Europe are projected to remain above levels recorded before the Iran war at least until the end of 2027. Prices of other goods are also expected to follow an upward path. 4 percent for 2027. 9 percent for 2027.

“We expect that this energy inflation will gradually also trickle down to different sectors of the economy,” Dombrovskis said after a meeting of the Eurogroup finance ministers. European Central Bank President Christine Lagarde stated that even if the Middle East conflict ended immediately, lagging effects would keep prices of goods elevated.

Lagarde added that price levels will likely remain higher once the crisis concludes. She said the ECB will take all necessary measures to maintain price stability at the 2 percent target by monitoring aftereffects of the energy price increase.

President Kyriakos Pierrakakis said an end to the crisis would allow free navigation through the Strait of Hormuz without tolls. Roughly one-fifth of the world’s oil and gas passes through the strait. 2 percent in 2027, below previous forecasts but still outside a recession scenario. Lagarde indicated the ECB will continue a data-dependent, meeting-by-meeting approach to monetary policy.