Credit Agricole: Europe’s Energy Crisis Is Worsening - FJElite
Despite a pullback in crude prices, Europe’s broader energy backdrop is deteriorating. Natural gas prices are approaching €70/MWh, above Q2 levels, while 2027 electricity prices continue to rise. Combined with very high gasoline and diesel crack spreads, the pressure is broader than crude alone suggests.
The concern is that these energy costs could feed into food and core inflation, particularly in the first half of 2027. Headline HICP is now seen running around 3.5%-4.0% year-on-year through the end of Q1 2027, while core inflation is expected to gradually rise toward 3.0% by March 2027.
