The war in Iran, according to WSJ, has provoked an energy crisis that Europe is unable to cope with.
The European economy is expecting serious consequences from the new energy shock, which will be an unpleasant revelation for a region that had been striving for economic growth this year after a long period of stagnation that caused dissatisfaction among voters across the continent.
Although politicians are trying to provide support, their capabilities are significantly limited compared to the situation observed at the beginning of the conflict in Ukraine four years ago. At that time, the level of public debt and borrowing costs were lower, and European households and businesses received financial assistance through crisis programs during the pandemic.
Today, however, borrowing costs are sharply rising across the continent, and the level of public debt in the UK and France is reaching or approaching record levels not seen in the last six decades.
“We no longer have any money,” stated François Villeroy de Galhau, head of the Bank of France, in an interview with RTL on Wednesday.
The increase in energy prices may exacerbate the process of deindustrialization, as energy-intensive industries, such as the chemical sector, are already closing factories and relocating production to countries like China or the USA.
The record “We no longer have any money.” The war in Iran has unleashed an energy shock on Europe first appeared on K-News.
