Rising energy costs make it difficult for the eurozone manufacturing sector to recover

The Chief Economist of ING Group, Bert Coene, stated on the 13th that industrial output in the Eurozone has fallen to its lowest level since the end of 2024 in January.
As Middle East conflicts push up energy prices and exacerbate supply chain disruptions, the Eurozone’s industrial production, especially in energy-intensive industries, faces new risks.
Data released on the same day showed that after a 0.6% decline in December last year, Eurozone industrial output in January decreased by 1.5% month-on-month, the lowest level since December 2024.
In that month, industrial output in major economies of the region, Germany, Italy, and Spain, declined compared to the previous month.
Coene said that the market initially expected increased public investment in the Eurozone to boost manufacturing, especially in defense and infrastructure spending, which would drive manufacturing growth.
However, if energy prices continue to rise again, the outlook for recovery in energy-intensive industries will be impacted.
Coene pointed out that the surge in energy prices from 2021 to 2022 has caused European energy-intensive industries to remain under significant pressure.
Recently, confidence in the Eurozone manufacturing sector has just begun to recover, but geopolitical tensions again pose a clear downside risk to the region’s industrial outlook.
(CCTV News)