Speed Up Green Deal – Don’t Shield Public From Fuel Costs, IMF Tells Europe Amid Middle East War

IMF said European national governments should not shield consumers and businesses from fuel price spikes due to the Middle East war, to speed the Green Deal and stop relying on imported fossil fuels. Make us preferred on Google Share Facebook X (Twitter) LinkedIn Bluesky Email Copy Copied IMF Senior Communications Officer Camilla Perez, European Department Director Alfred Kammer and Deputy Directors Oya Celasun and Helge Berger brief the press on the latest Regional Economic Outlook for Europe during the 2026 Spring Meetings of the IMF and the World Bank Group in Washington, DC, April 17, 2026. (Photo by Jabin Botsford / courtesy of IMF Photo) Content Share Facebook X (Twitter) LinkedIn Bluesky Email Copy Copied Flip Make us preferred on Google IMF European Department Chief Alfred Kammer urged Europe to decrease reliance on imported fossil fuels, naming it as a vulnerability that “has shown up in the 1970s, again with the Russian gas shut off, and with the war in the Middle East.” It will help the continent to protect itself further energy price shocks, while also getting decarbonized affordable energy, the European Chief said on the briefing presenting Regional Economic Outlook on Europe during the 2026 IMF Spring Meetings. Follow our coverage of the war on the @Kyivpost_official . Kammer pointed to the EU’s Green Deal that could eliminate or “severely limit” Europe’s dependency on importing fossil fuels. Europe’s growth is estimated at 1.5% for 2026, and 1.6% for 2027, according to the report. “Right now, in out forecast, we do not see a recession in Europe materializing, even in the severe scenario,” Kammer said, replying to Kyiv Post’s question. Ukraine’s growth is forecast at 2% real GDP for 2026 and 3.5% for 2027, according to the outlook, remaining unchanged since the IMF downgraded its prognosis following Russia’s winter bombardment of energy infrastructure. Kyiv Post business correspondent Olena Hrazhdan at the Regional Economic Outlook for Europe during the 2026 Spring Meetings of the International Monetary Fund and the World Bank Group in Washington, DC, April 17, 2026. (Photo by Jabin Botsford / courtesy of IMF Photo) Other Topics of Interest Creditors Agree to Postpone Ukraine’s Debt Payments Until 2030 Ukraine and its G7 and Paris Club creditors have agreed to defer state and state-guaranteed debt payments until 2030. Kammer advised Europe “not to suppress the price signal” while helping their populations and businesses cope with the fuel price shock from the war in the Middle East. He explained that Europe’s budgets cannot afford massive cash spending on subsidies or tax cuts to combat the crisis since the packages cost is so large compared to their national GDPs. The IMF focused its recommendations for Europe on the short-term since the events in the war in the Middle East keep changing and remain unpredictable. The US and Iran are reportedly negotiating to reopen the Strait of Hormuz, the gate for transit of the 20% of the world’s energy sources, as other countries of the Gulf are either in hostilities or negotiations. “Our recommendation here is not to suppress the price signal, because in the end we need to balance the demand and supply and that is best achieved through the price mechanism,” Kammer said. “Target fiscal measures to the vulnerable,” he added. Kammer also said Europe must reorganize its economy and create more efficiency by pursuing these objectives: Olena Hrazhdan is the Business Reporter at Kyiv Post, covering Ukraine’s markets, business, and economic policy. While she reports broadly on economic issues, her core focus is banking, finance, monetary and fiscal policy. Olena previously wrote for leading Ukrainian business media and became a Fellow of the International Monetary Fund’s Journalism Fellowship in 2024.