European Commission warns of Middle East energy shock risks and finds Belgium's 2026 draft budget plan compliant with excessive deficit procedure

In remarks published after the Eurogroup press conference, European Commission Commissioner Valdis Dombrovskis said the EU economy remains on course for modest growth but faces material downside risks from the conflict in the Middle East. He said the rise in energy prices and any prolonged disruption to shipping and energy infrastructure could expose Europe and the wider global economy to a stagflationary shock, although it is too early to draw specific policy conclusions. Dombrovskis also presented the Commission's opinion that Belgium's Draft Budgetary Plan for 2026 complies with the requirements of the excessive deficit procedure, while noting that Belgium still needs continued fiscal consolidation and reform to address its difficult public finances. On digital finance, Eurogroup discussions covered crypto assets and stablecoins, with Dombrovskis noting that US dollar-denominated stablecoins dominate global and European markets and arguing for euro-denominated alternatives, stronger EU payment systems and faster work on the digital euro. He added that the upcoming One Europe, One Market Roadmap will set out concrete steps and deadlines on cutting red tape, deepening the Single Market, strengthening trade links and reducing energy dependencies. At the G7 level, ministers committed to coordinate positions on energy supply risks, and the group stands ready to take measures such as stockpile release.