According to Veronika Grimm, a supervisory board member at Siemens Energy, economic stagnation is not unlikely in the context of the oil crisis, and she warns that the impacts of the war in Iran should not be underestimated. Speaking to the “Rheinische Post” (Saturday edition), she stated that the repercussions “will be felt for longer than initially expected”. She also noted that the general mood in Germany appears to be overly optimistic.
Grimm added that people tend to underestimate the difficulty of ending a war, emphasizing that “all three warring parties need to agree on that”.
For the global economy, the consequences are expected to be serious, as 20 percent of oil and liquefied natural gas (LNG), along with a third of fertilizer shipments, pass through the Strait of Hormuz, according to Grimm. She is also a member of the advisory board for the CDU-affiliated interest group, the CDU Economic Council. Furthermore, she pointed out that many production facilities have been destroyed, and “it will take years to remedy the damage”.
The economist finds the recent growth forecasts from research institutes to be optimistic. Regarding the expectation from institutes that Germany will see only 0.6 percent economic growth in 2026, she believes this forecast to be too positive. However, she does state that she does not consider a scenario where the economic upswing entirely fails and the country enters stagnation to be improbable.