On Tuesday, March 24, 2026, Economy Minister Roland Lescure, used the term “oil shock.” He withdrew the statement the next day, but INSEE figures remain: inflation is expected to exceed 2%, impacting households’ purchasing power, with the main impact expected in 2027. This comes after a month of the Strait of Hormuz being blocked by Iran, with France already feeling the effects, as fuel prices have risen due to the blockade.
The United States’ weakened position has been attributed to the blockade in the Strait of Hormuz as a symptom of their declining maritime power since 1945. The crisis in Yemen involving the Houthis has exacerbated this decline as Western commercial fleets are unable to use the Red Sea due to the alliance between the Houthis, Iranian revolutionary guards, and China.
Experts warn of the negative impact on growth due to current developments, both in terms of prices and logistical challenges in international trade. Arnaud Orain emphasizes that industries such as chemistry, metallurgy, glass, and semiconductors will directly feel the rise in raw material prices, affecting France’s agricultural exports and global food security.
The war in Iran is expected to increase central banks’ interest rate expectations, affecting sovereign debt risks, particularly for highly indebted European countries like France and Italy. This situation prompts discussions on the sustainability of public debts and the need for alternatives to the weakening U.S. assets for global financing.
Amidst these challenges, there is a call for new economic models focusing on decarbonization, frugality, and reduced production and consumption levels to navigate the changing geopolitical landscape characterized by rising tensions between the U.S. and China.
Sources:
- France Culture Image:
- France Culture Image:
