Energy crisis drives economic pressure in Greece and inflation risks in Eurozone

The ongoing energy crisis continues to exert significant economic pressure across Europe. In Greece, the financial burden on households is estimated to reach approximately 500 million euros per month. This impact is driven by rising costs for transport fuels, heating, and natural gas, which in turn affects production and logistics costs for businesses. To mitigate fuel costs, the Greek government has implemented subsidies, such as a 15-cent per liter diesel subsidy in early October, though these are viewed as temporary measures.

On a broader scale, the European Central Bank (ECB) has warned that the energy shock poses a persistent inflationary risk. ECB Governing Council member Olli Reen noted that while the pass-through effect on prices and wages has been milder than initially expected, geopolitical tensions in the Middle East could exacerbate the situation. The ECB is closely monitoring whether prolonged energy costs lead to higher wage demands, which could trigger a permanent inflationary spiral and complicate the return to the 2% inflation target.