OPEN LETTER: To you, the Europeans paying the bill for the Iran war

A glimmer of hope — but let us not celebrate too quickly

According to data published by Bloomberg on June 26, 2026, inflation in the eurozone may have reached 3.0% in June — a first slowdown compared to the 3.2% recorded in May. This would be the first decline since the outbreak of the war in Iran, several months ago. I want to write to you that this is good news. I want to write to you that the worst is behind us. I cannot do so honestly, because this slowdown is as thin as a layer of ice over a lake — it looks like it holds, until it no longer does.

Allow me to be direct with you. Before the war in Iran, inflation in the eurozone stood at 1.7% in January 2026 — comfortably below the European Central Bank's 2% target. Since the Strait of Hormuz was closed and energy prices exploded, you have been paying more every single day to heat your homes, travel, and eat. Not because you did anything wrong. Because a war thousands of kilometers from your door upended the global energy order. And nobody has really explained to you why you are carrying this bill.

What 3.2% in May actually means

In May 2026, Eurostat confirmed inflation of 3.2% in the eurozone — with energy up +10.9%, services at +3.5%, and food at +2.0%. The energy bill is the one that hurts most because it hits everyone without exception — the retiree heating an apartment in Spain, the taxi driver in Poland, the baker in France. The +10.9% on energy is the Iranian shock translated into euros on your monthly statements.

The ECB, in its June 2026 projections, forecast average inflation of 3.0% for the year, 2.3% in 2027, and 2.0% in 2028. It is asking you to wait two years before recovering stability. Two years during which every shopping trip, every heating bill, every tank of gas will cost more than you budgeted, planned, or expected. Two years of that silent gap between what you earn and what things cost.

I am writing to you from the same reality you live in. I see the same price tags at the grocery store, I receive the same gas bills. And I refuse to present a drop of 0.2 percentage points as a victory. Inflation at 3.2% and then 3.0% is like saying you are swimming better — you are still sinking, just a little more slowly.

The world's most strategic strait — and its closure

The Strait of Hormuz is a waterway 33 kilometers wide at its narrowest point, through which approximately 20% of the world's oil and 30% of exported liquefied natural gas (LNG) passes. When this waterway closes — even partially, even temporarily — energy markets panic. Forward prices soar. And European households, which largely abandoned Russian gas after 2022 in favor of Gulf LNG, find themselves caught in the same spiral again.

Iran knew exactly what it was doing when it threatened, then disrupted, navigation through the Strait of Hormuz. It is Iran's most powerful lever. And it used it. The market effects described by the Wall Street Journal in March 2026 were immediate and violent: Brent crude above $100, European gas futures up 40% in a matter of weeks. What happens at Hormuz ends up on your heating bill. That causal chain is direct, brutal, and deeply unfair to you.

Why Europe remains particularly exposed

The United States, since the shale gas revolution, has become largely energy self-sufficient. China has massively diversified its supply chains and holds enormous strategic reserves. Europe, meanwhile, remains dangerously dependent on international energy markets. The post-Russian-gas transition is not complete. Renewable energy investments have not yet generated sufficient capacity to absorb a shock of this scale. You are caught between an unfinished energy transition and an exogenous shock over which you have no direct control.

The eurozone GDP contracted by 0.2% in the first quarter of 2026 — a technical recession at the very threshold of the definition, but a recession nonetheless. Growth forecast at 0.8% for the full year, according to the ECB. In plain terms: prices rising, economy stalling. This is what is called stagflation, and it is the worst possible combination for households.

Europe made the right choice in breaking with Russian gas after the aggression against Ukraine. It was not an easy choice — it was a morally and strategically correct one. But we must be honest: we have not finished paying the cost of that choice, and the Iranian shock arrived before we were ready to absorb it. That is not a reason to regret it. It is a reason to build faster.

The 25 basis point hike of June 11, 2026

On June 11, 2026, the European Central Bank raised its key interest rates by 25 basis points — the first increase in nearly 3 years, bringing the deposit rate to 2.25%. Christine Lagarde called the decision "robust," meaning firmly grounded in data. In plain terms: inflation is too persistent to let rates fall. The ECB is choosing to prioritize price stability over growth.

This is the technically correct decision under the ECB's mandate. But here is what it means for you: variable-rate mortgage payments cost more. Loans to small businesses are more expensive. Business investment slows. Consumer spending is constrained. These are intentional brakes on the economy — designed to slow inflation by slowing demand. The logic is coherent. The casualties are the households with variable-rate mortgages, the self-employed, the family-owned businesses.

Another hike in September? Markets think so

Financial market expectations point toward another 25 basis point increase in September 2026, which would bring the deposit rate to 2.5%. Philip Lane, the ECB's chief economist, declared that the bank will remain "proactive" even after a potential peace agreement in Iran — because imported inflation takes time to dissipate through value chains, and the ECB does not want to repeat the mistake of 2021-2022 of allowing inflation expectations to become unanchored.

Consumer inflation expectations, as measured by the ECB's monthly survey, stood at 3.5% in May — 1.5 points above target. When consumers expect high inflation, they demand wage increases, companies raise prices preemptively, and inflation becomes self-fulfilling. This is the price-wage spiral that the ECB wants to break by acting now, even at the cost of reduced growth.

I understand Lagarde's logic. I genuinely do. But we must name clearly what it means: the ECB is choosing to make borrowers and small businesses suffer now to protect the value of the euro tomorrow. This is a collective choice made by an unelected institution. That choice may be right — and still be painful for those who bear it.

The structural losers of stagflation

Inflation does not strike uniformly. It strikes hardest those with the least margin. A senior executive who renegotiated a salary indexed to inflation manages. A working-class family on a fixed income, a retiree with a pension not fully indexed to actual inflation, a young couple with a variable-rate mortgage — these people lose real purchasing power every month. This is not an economic abstraction. It is canceled vacations, deferred dental care, months that do not end when they should.

Eurostat data from June 2026 confirms that the hardest-hit categories are domestic energy (+10.9%), transportation (+7.2% estimated), and processed food (+3.1%). This basket of spending represents a disproportionate share of modest household budgets. The average figures mask a class reality: inflation at 3.2% is mild pain for the wealthy and severe pain for those struggling.

Southern countries: Spain, Italy, Portugal under heightened pressure

The eurozone is not homogeneous. Spain, according to Euronews, suffered inflation stuck at 3.2% for the third consecutive month in June 2026 — without the same absorption capacity as Germany or the Netherlands. Italy and Portugal, with their industrial fabric exposed to energy costs and their large retiree populations, are particularly vulnerable to the combination of weak growth and persistent inflation.

The ECB sets a single rate for 20 countries with very different economic structures. A rate of 2.25% may be well-calibrated for Germany while being slightly too high for Italy and slightly too low for the Baltic states. This is the fundamental constraint of the monetary union — and it becomes cruel when asymmetric shocks hit some countries harder than others.

I think of the Spanish retiree whose pension has not kept pace with inflation. Of the Italian restaurant owner watching her gas bill double while fewer customers come through the door. These people do not appear in economic models. They are not part of the indicators Eurostat publishes. But they are the ones living inflation in their bodies, every single day.

Early signs of a provisional US-Iran agreement

Early indications of a provisional US-Iran agreement circulated in June — enough for markets to begin pricing in a gradual normalization of energy prices. This is partly what explains the slight slowdown in inflation in June 2026. But Philip Lane was clear: even if a peace agreement were concluded tomorrow, the effects on inflation would take several quarters to fully materialize through value chains.

LNG and oil prices do not fall as fast as they rise. Long-term contracts for European energy supply were signed at high prices, and those contracts have durations. Companies that passed higher energy costs on to their sale prices will not lower those prices immediately — they will wait to see whether the cost reduction is durable. Imported inflation enters prices through the front door; it exits through the back door, slowly and quietly.

What a lasting agreement would change — and what it would not

A durable peace agreement in Iran, with a secure reopening of the Strait of Hormuz and a gradual normalization of Iranian oil and gas exports, would allow eurozone energy inflation to fall by several points over a 12 to 18-month horizon. That would be meaningful. That would be real relief for European households.

But it would not resolve the structural problem: European dependence on global energy markets. Every geopolitical shock that disrupts those markets — in the Middle East, in sub-Saharan Africa, in strategic straits — translates immediately into imported inflation in Europe. Without accelerated energy transition and without massive storage capacity, this mechanism will repeat itself. And the next crisis will not send advance notice.

The Iran war gave us a free lesson — painful, but valuable: our energy dependence is a major strategic vulnerability. Every euro not invested today in renewables, storage, and energy efficiency will be paid back as inflation the next time a war breaks out 3,000 km from our doorstep. And there will be a next time.

Targeted fiscal responses to protect the most vulnerable

The ECB manages monetary policy. But monetary policy cannot do everything. It cannot compensate the impact of inflation on lower-income households — it can only slow inflation at the aggregate level, at the cost of growth. What can compensate are targeted fiscal policies by governments: energy tariff shields, direct transfers to the most exposed households, exceptional indexation of the lowest pensions.

The European Parliament, in its June 2026 brief, underlines the need to coordinate national fiscal policies to prevent member state aid measures from contradicting each other or themselves fueling inflation. This is a difficult balance: protect without stimulating, support without destabilizing. But the alternative — leaving the most fragile households to absorb the Iranian shock alone — is politically and morally untenable.

Accelerating the energy transition: now, not in ten years

The structural response to these cycles of imported inflation is well known and surprises no one: massively accelerate the transition to renewable energy, invest in storage capacity (large-scale batteries, green hydrogen), and improve the energy efficiency of Europe's building stock. Every gigawatt of solar or wind power installed is a point of European GDP no longer dependent on the price of LNG in Qatar or Saudi oil.

This transition costs money. It requires political will, massive public investment, and a stable regulatory framework. It meets resistance — from fossil industries, from lobbies, from politicians who prefer the comfort of the status quo to the short-term pain of transformation. But in 2026, after a year of Iranian energy shock, it should be impossible to pretend this transition can still wait. Every month lost is one more month of vulnerability.

We have been saying "energy transition" for twenty years. Too often, we said "yes, but..." — but the cost, but the jobs, but competitiveness. The Iranian shock should close those unfinished sentences for good. The cost of inaction is now visible on every heating bill. We have no more excuses.

The transparency your governments owe you

You deserve to be told the truth: inflation at 3.2% in May 2026, then possibly 3.0% in June, is not a consequence of excessive spending on your part or a poorly managed European economy. It is the result of a war in a region of the world where your energy supply is still partially held hostage. You are absorbing the consequences of geopolitics over which you have no direct control. That truth, few leaders tell you clearly — because it is more comfortable to talk about "market pressures" or a "difficult international context."

You also deserve to be told that the ECB rate hike of June 11 is necessary medicine, but painful — and that some of you are paying far more of that cost than others. Homeowners with variable-rate mortgages, growing entrepreneurs, young households just getting established — they carry a disproportionate share of the cost of monetary stabilization. It is unequal. It is inherent to monetary policy. It is real.

My promise as a columnist

I am not going to tell you things will be fine if I do not know whether they will be fine. I am not going to minimize 3.2% inflation because other parts of the world have experienced worse. I will continue naming what is happening: the geopolitical costs you are absorbing, the institutional choices that affect you, the decisions that deserve to be openly debated rather than quietly managed in the corridors of central banks and finance ministries.

Democracy requires an economy understood by its citizens. Not in every technical detail — but in its fundamental logic, in its real-world impact, in the choices it imposes. You deserve that clarity. You deserve more than reassuring press releases. You deserve to be spoken to as adults living a difficult reality who have the right to know why.

This letter is not optimistic. Nor is it despairing. It tries to be honest — something that many official economic speeches do not always manage to be. You deserve better than being reassured with numbers that mask your daily pain. You deserve to be looked at directly.

The United States: a structural resilience Europe does not yet have

While the eurozone absorbed a severe inflationary shock, the United States experienced a far more limited disruption thanks to their energy self-sufficiency. As massive producers of shale oil and gas, they do not carry the same dependence on Gulf LNG markets. The Federal Reserve did not have to raise rates to the same degree the ECB did. This asymmetry is not a coincidence — it is the result of decades of investment in domestic energy infrastructure and consistent industrial policy.

The contrast is striking: while the European consumer sees an energy bill up 10.9%, the average American consumer absorbed a far more limited shock. This does not mean America is better managed economically — it means it made different structural choices about its energy mix. Europe can learn from that resilience, even if it rightly refuses to replicate the American oil model.

The Gulf states: the irony of the energy destiny

The irony of the situation is that the countries of the Persian Gulf — Saudi Arabia, the United Arab Emirates, Qatar — have seen their revenues explode thanks to the war in Iran, which disrupted deliveries from their regional competitor. OPEC+ oil and gas is selling at record prices, enriching states whose political systems are very far removed from European democratic values. This is another structural injustice: European households are impoverishing autocratic petro-states by paying more for their energy.

This reality should accelerate, not slow, the European energy transition. Every solar panel installed, every offshore wind turbine in the North Sea, every insulated building is one euro less sent to regimes that do not share our values — and one euro less exposed to the geopolitical vagaries of the Middle East. Energy sovereignty is also a matter of democratic consistency.

We are paying more for Saudi energy because Iran is at war. There is a total geopolitical absurdity in that sentence that Europe endures without having chosen it. The only real way forward is to stop depending on this equation. The energy transition is not an ecological luxury. It is a sovereign necessity.

The danger of normalization

The first human reflex in the face of persistent pain is to adapt to it. To recalibrate expectations. To consider 3.2% inflation "normal" because it has been going on for months. This normalization process is dangerous: it masks the real erosion of purchasing power, it reduces pressure on governments and institutions to act, and it leaves the most vulnerable — those who cannot adapt their behavior because they have no margin left — bearing the full weight of adjustment alone.

The decline to 3.0% in June 2026 is a marginal improvement within an overall picture that remains worrying. Energy is still +10.9% as of May. Growth is forecast at 0.8% for the year. The ECB is considering another rate hike in September. The Iranian peace agreement remains uncertain. This is not the moment to celebrate. It is the moment to demand structural policies — on energy, on household protection, on European fiscal coordination.

What you can demand from your governments

You are citizens of democracies. You have rights and voices. Demand transparent tariff shields with clear activation criteria for energy shocks. Demand credible energy transition plans with annual milestones and public accountability reports. Demand that your elected representatives vote for European energy independence as if it were an emergency — because it is an emergency. And demand transparency on the ECB's monetary policy choices: not demagogic anti-central-bank rhetoric, but a real democratic debate on the trade-offs between inflation and growth.

Europe has survived far worse shocks than this one. It has the institutional resources, the technological capabilities, and the collective intelligence to get through this period and emerge more resilient. But that does not happen automatically. It happens when citizens demand responses equal to the challenges. In 2026, the challenge is before you. So is the bill.

I am not writing to you from an ivory tower. I am where you are — watching the prices, trying to understand the choices being made by institutions managing the economy in our name. I would have preferred this letter to be unnecessary. I would have preferred it to have no reason to exist. But as long as there is 3.2% inflation and 0.8% growth, it will have its reason. And I will keep writing to you.

By Maxime Marquette, columnist

Editorial stance

I am not a journalist but a columnist and analyst. My expertise lies in observing and analysing the geopolitical, economic and strategic dynamics that shape our world. My work is to take political strategies apart, to understand global economic movements, to put the decisions of international actors in context and to offer analytical perspectives on the changes that are redefining our societies.

I do not claim the cold objectivity of traditional journalism, which stops at reporting facts. I claim analytical clarity, rigorous interpretation and a deep understanding of the complex issues that concern us all. My role is to give meaning to the facts, to place them in their historical and strategic context, and to offer a critical reading of events.

Method and sources

This text keeps the basic distinction between verified facts and interpretive analysis. The rule never changes: a factual claim is published only when a verifiable source supports it, and the sources this article actually used are listed under Sources, never here.

Primary source families used by the publication, when the story has them: official statements from governments and international institutions, public statements by political leaders, reports from intergovernmental organisations, dispatches from recognised international news agencies.

Secondary source families: specialised publications, internationally recognised news media, analyses from established research institutions, reports from industry organisations.

When an article cites statistical, economic or geopolitical data, it comes from the institutions that produce it (intergovernmental organisations, central banks, national statistics offices), and the exact institution is named under Sources.

Nature of the analysis

The analyses, interpretations and perspectives in the analytical sections of this article are a critical, contextual synthesis based on the information available, the trends observed and the expert comments cited in the sources consulted.

My role is to interpret these facts, to set them in the context of today's geopolitical and economic dynamics, and to give them a coherent meaning within the larger story of the changes shaping our time. These analyses reflect expertise built through continuous observation of international affairs and an understanding of the strategic mechanisms that drive global actors.

This article describes a documented state of affairs on its publication date, not a prediction: later developments may shift its outlook. No update is promised in advance; when an article is corrected or completed, the change is dated in the text.