A senior ECB policy official warned that if oil prices remain around $100 per barrel until the end of the year, the ECB will have to raise interest rates further. After the ECB completed its second rate hike of the year on Thursday, Bank of Austria Governor Martin Kochel warned in an interview that tension in the Middle East continues, energy prices are high, and “the risk of inflation is higher than a few months ago.” Since the US-Iran cease-fire agreement broke down in early July, oil prices have soared by more than 45%, breaking through $100 per barrel. European gas prices have almost doubled since June, approaching 80 euros per megawatt-hour.

A senior ECB policy official warned that if oil prices remain around $100 per barrel until the end of the year, the ECB will have to raise interest rates further. After the ECB completed its second rate hike of the year on Thursday, Bank of Austria Governor Martin Kochel warned in an interview that tension in the Middle East continues, energy prices are high, and “the risk of inflation is higher than a few months ago.” Since the US-Iran cease-fire agreement broke down in early July, oil prices have soared by more than 45%, breaking through $100 per barrel. European gas prices have almost doubled since June, approaching 80 euros per megawatt-hour.