Meeting of 22-23 July 2026

Account of the monetary policy meeting of the Governing Council of the European Central Bank held in Frankfurt am Main on Wednesday and Thursday, 22-23 July 2026

1. Review of financial, economic and monetary developments and policy options

Ms Schnabel started her presentation with the observation that since the Governing Council’s monetary policy meeting on 10-11 June 2026 financial markets had continued to be driven by the evolving conflict in the Middle East and developments around artificial intelligence (AI).

Oil prices had remained highly sensitive to geopolitical developments. Vessel traffic through the Strait of Hormuz had increased temporarily but remained well below historical norms. Since the latest escalation of the conflict, traffic had declined again, underscoring the persistence of the disruptions to global energy supply chains. These developments had led to pronounced swings in oil markets. Brent crude oil prices had briefly fallen back to pre-war levels following the announcement of a preliminary peace agreement. In spite of the recent rebound, current prices remained well below their recent peaks and below the levels prevailing just ahead of the Governing Council meeting on 10-11 June. By contrast, prices for longer-dated oil futures contracts had remained elevated throughout the short-term oil price volatility. While the futures curve had shifted downwards since June 2026, it remained well above pre-war levels over the entire horizon, pointing to a persistent increase in oil prices with risks remaining tilted to the upside.