This edition of the Global Trade Update examines the strong but increasingly uneven expansion of international trade in the first half of 2026.
Global goods trade is estimated to have reached approximately US$13.7 trillion in the first half of 2026, up 12.5 % from the same period in 2025. Services trade grew by 10.5 %. Together, goods and services added around US$2 trillion to global trade, putting it on course for a record annual value.
Higher prices inflate trade growth
A significant share of the increase reflects higher prices rather than stronger trade volumes. Disruptions to shipping through the Strait of Hormuz, together with concerns over energy supplies, raised energy, transport, logistics and production costs.
Prices of traded goods increased by about 3.6 % in the first quarter and is estimated to have risen by about 5 % in the second, largely reflecting higher energy and selected commodity prices.
East Asia leads an uneven expansion
East Asia was the main engine of global trade growth in the first quarter of 2026, supported by strong import and export performance in China and the Republic of Korea. Trade in other Asian subregions contracted , while Africa and the Americas experienced stronger import than export growth.
East Asia’s role was also central to South-South trade: excluding the region, trade among developing economies contracted during the first quarter. Trade balances continued to shift, with China’s surplus widening and the United States’ deficit narrowing.
AI and electric mobility support sectoral growth
During the first quarter of 2026, demand for AI infrastructure, digital technologies and electric mobility drove strong growth in technology-intensive goods. Trade increased by 38 % for critical minerals, 25 % for semiconductors, 15 % for batteries, 14 % for ICT products, and 11 % for electric vehicles.
By contrast, trade contracted in chemicals, iron and steel, and some renewable-energy products. Fossil-fuel trade increased largely because of higher prices.
Click here to access the full report.
 
 
Compliments of UN Trade and Development (UNCTAD) The post UNCTAD | Global Trade Continues to Expand Amid Rising Price Pressures first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Blog | Energy prices are surging again, pushing up inflation in the euro area. This ECB Blog post examines whether firms are attributing this to a demand surge or to supply constraints. Two approaches – textual analysis and empirical models – can help make the picture clearer.
For central banks, whether inflation stems from demand or supply makes a crucial difference. Demand-driven inflation (sometimes called demand-pull inflation) calls for a firm policy response. Meanwhile, supply-driven inflation (also known as cost-push inflation) warrants a more careful assessment. This second kind is often caused by developments that are largely outside a central bank’s control – something to be weathered rather than fought. Telling the two types of inflation apart in real time is one of the hardest challenges in monetary policy.
The war in the Middle East has brought this challenge back to the fore. Between February and June 2026, the surge in crude oil prices triggered by the conflict led to a sharp upswing in energy inflation, pushing euro area headline inflation up from 1.9% to 2.8% year on year (Chart 1, panel a). These developments are reminiscent of the events following Russia’s invasion of Ukraine in February 2022 (panel b). Now as then, the inflation surge appears to be largely driven by an energy supply shock. However, when designing the monetary policy response, the nature of the shock itself is only one part of the story. The balance between demand and supply pressures at the moment the shock hits also matters, as does the breadth, size and persistence of the shock. And here too, supply and demand factors both come into play.[1]
To answer this question, we draw on two complementary approaches. First, we look at what financial actors are saying about inflation, based on a textual analysis of corporate earnings calls and articles in the financial press. Second, we use two empirical models to examine what firms are telling business surveys about their expectations. Crucially, both approaches are based on timely, forward-looking indicators. That makes these tools particularly well suited to real-time assessment, especially in the absence of timely hard data.
Indeed, at the time of publication, we are not aware of any analyses based on hard data for the euro area that compare the nature of the recent inflation surge to that of the 2022 episode.[2]

Chart 1
Oil prices and HICP inflation in 2026 and 2022

(left-hand scale: USD/barrel; year-on-year change, percentage)

Sources: Energy Information Administration, Eurostat, European Commission and ECB staff calculations.
Notes: The vertical lines separate the periods before the outbreak of the war in the Middle East at the end of February 2026 (left) and in Ukraine at the end of February 2022 (right) from the periods that followed. The latest observations are for June 2026.

What companies and newspapers are saying
A first clue comes from earnings calls, the quarterly conference calls in which listed firms discuss their results and outlook with investors. By scanning these calls for mentions of both inflation and inflation risks, we can track how much attention firms are paying to price pressures and the risks they pose to their operations in near real time. In May 2026, firms’ focus on inflation and inflation risks had intensified since the start of the Middle East conflict. However, the levels and degrees of variation remained below those observed in March 2022, when Russia’s invasion of Ukraine sent energy prices spiralling (Chart 2, panel a).
A second indicator of what drives inflation comes from the financial press. Using a text analysis algorithm – specifically, a causality extraction method – we can identify and classify the causes of inflation reported in newspaper articles.[3] The algorithm first extracts the causes of inflation described from sentences that mention inflation together with explicit causal language. It then assigns these to either demand or supply narratives.[4] Demand narratives tend to cite factors such as strong consumer spending, fiscal deficits or monetary stimulus. Supply narratives tend to reference energy prices, supply chain disruptions or input costs.
The results are striking. Compared with 2022, since the start of the war in the Middle East demand-side narratives – stories about consumer spending and monetary stimulus – have played a smaller role than supply narratives – stories about energy costs and supply chain disruptions (Chart 2, panel b). More specifically, this time round the financial press has largely attributed inflation to energy cost-related supply narratives. In contrast, there was a broader mix of narratives back in 2022, with greater prominence given to supply chain disruptions. This is an important initial signal, pointing to comparatively clearer cost-push (rather than demand-pull) inflation in the current episode.

Chart 2
Firms’ attention to inflation and inflation risks and news-based narratives in 2026 and 2022

a) Firms’ attention to inflation and inflation risks
(cross-sectional average of sentences mentioning inflation keywords, three-month moving average)

b) Demand and supply narratives
(volume of Financial Times articles, period average)

Sources: NL Analytics, Financial Times and ECB calculations.
Notes: In panel a), the vertical lines separate the periods before and after and the outbreak of the war in the Middle East at the end of February 2026 (i) and Russia’s invasion of Ukraine at the end of February 2022 (ii). Firms’ attention to inflation is the three-month moving average of the cross-sectional average number of NL Analytics earnings-call sentences mentioning inflation keywords. Firms’ attention to inflation risk is the three-month moving average of the cross-sectional average number of NL Analytics earnings-call sentences mentioning inflation keywords as well as risk or uncertainty-related language. The inflation keywords come from Song and Stern (2025). Risk and uncertainty-related language comes from Hassan et al. (2019). In panel b), the figures are derived from averages of the months considered. Demand and supply narratives are derived from Financial Times inflation articles using the causality extraction method in Trebbi (2025). The latest observations are for June 2026.

What business surveys reveal
For a precise assessment of the drivers of firms’ price expectations, we turn to the European Commission’s business surveys, which poll companies in the manufacturing, services and construction sector. Once a month, these surveys gather feedback about firms’ three-month-ahead expectations for prices and activity.[5] Once a quarter, firms are also asked about any specific obstacles limiting their production – e.g. insufficient demand, financial constraints, materials shortages or labour constraints.
We then combine these responses into composite indices – weighted averages across sectors – and use two structural models to interpret their movements. A monthly model identifies two types of shock: demand shocks move activity and price expectations in the same direction, whereas supply shocks pull them in opposite directions. For instance, when inflation is driven by expansionary demand, firms expect both economic activity and prices to rise. Conversely, when adverse supply conditions push prices up, they expect economic activity to decline. A more granular quarterly model can then help us to further tease out factor-specific drivers: three shocks on the demand side (product demand, financial conditions and other demand) and three on the supply side (materials supply, labour conditions and other supply).[6]
So what do we find?
The composite index of business price expectations rose markedly after the outbreak of the war in the Middle East, and has remained above its pre-war level ever since. Structural decompositions can help explain why (Chart 3). Amid broadly stable demand-pull pressures, cost-push shocks drove up price expectations at the start of the war (panel a). At granular level, these shocks mainly reflected materials supply shortages – linked to higher energy prices – and were concentrated in manufacturing – particularly in energy-intensive subsectors such as chemicals, refined petroleum and paper products (panel b).
As these findings reveal, today’s picture is quite different from the one in 2022. After Russia’s invasion of Ukraine, business price expectations stood significantly above their current level – by about two standard deviations. The higher level in 2022 reflected stronger broad-based inflationary pressures, as demand was buoyant – driven by the post-pandemic reopening, especially in services – while supply was constrained – with global bottlenecks still biting, most notably in manufacturing. Also, the composition of demand and supply shocks was different back in 2022. Demand-pull pressures dominated in 2022, whereas cost-push inflationary forces have played a comparatively larger role in the current episode.

Chart 3
Drivers of business price expectations in 2026 and 2022

a) Demand-supply decomposition of monthly composite business price expectations
(standardised balances)

b) Granular decomposition of quarterly business price expectations in the two episodes
(one-quarter changes in standardised balances)

Sources: European Commission and ECB staff calculations.
Notes: In panel a), the vertical lines separate the periods before and after Russia’s invasion of Ukraine at the end of February 2022 (i) and the outbreak of the war in the Middle East at the end of February 2026 (ii). The decomposition is estimated using a Bayesian structural vector autoregression model on monthly data for composite business expectations for activity and prices. In panel b), the decomposition is estimated using a Bayesian structural vector autoregression model on quarterly data for composite business expectations for activity and prices, as well as factors limiting production (insufficient demand, financial constraints, shortage of materials and equipment, shortage of labour force, other limits). In both panels, “residual” refers to the sum of a constant and an unexplained shock. Composite business price expectations refer to the gross value added-weighted average of three-month-ahead selling price expectations for manufacturing (22%), services (71%) and construction (7%). For further details on the estimation, see Battistini and Neves (2026). The latest observations are for June 2026 in panel a) and for the second quarter of 2026 in panel b).

What all this means for monetary policy
Taken together, the two approaches tell a consistent story. Unlike the 2022 episode, the current rise in inflation has been driven, first and foremost, by a supply shock. It has been fuelled by rising energy prices passing through the production chain, rather than by a broad-based surge in demand. Firms understand this. They have paid increasing attention to inflation and inflation risks, and their demand expectations have remained flat. The press understands this too. Supply narratives about energy prices have dominated media coverage.
For the ECB, these findings matter. A supply-driven inflation episode does not automatically call for the same forceful tightening that demand-pull inflation would warrant. However, supply shocks can become entrenched if they feed more broadly into wages or inflation expectations and add to demand pressures. Monitoring the drivers of inflation based on firms’ expectations – ahead of any official hard data – can be useful for calibrating policy appropriately in real time.
The two frameworks presented here offer just such a forward-looking perspective. Combined, they provide an early-warning system – grounded in what newspapers report, as well as in what firms say and expect – that can help central banks stay ahead of rapidly shifting economic conditions.
The views expressed in each blog entry are those of the author(s) and do not necessarily represent the views of the European Central Bank and the Eurosystem.

See Arce, Ó., Battistini, N., Bouabdallah, O., Lis, E. and Mohr, M. (2026), “A tale of two energy crises – initial conditions matter”, The ECB Blog, 3 June; andArce, Ó. and Sondermann, D. (2026), “Low unemployment, plenty of labour: what does it imply for wage pressures”, The ECB Blog, 9 March.

See, e.g., Nickel, C. et al. (2025), “A strategic view on the economic and inflation environment in the euro area”, Occasional Paper Series, No 371, ECB.

For further details, see Trebbi, G. (2025), “Inflation narratives and expectations”, Working Paper Series, No 3158, ECB.

The initial unit of analysis is at the article level. An article is classified as a demand or supply article based on the type of narrative most frequently mentioned. Mixed cases typically result in an article not being classified as either.

Due to the specific phrasing of the questions asked to firms in different sectors, “activity” refers to production for manufacturing, demand for services and employment for construction.

“Other demand” and “other supply” shocks capture a broad range of disturbances, mainly related to uncertainty on the demand side and supply chain disruptions and regulations on the supply side. These shocks played a notable role in the fluctuations in activity and price expectations at the height of the COVID-19 pandemic. For further details, see Battistini, N. and Neves, P. (2026), “What drives business expectations? A tale of demand and supply”, Working Paper Series, No 3179, ECB.

 
 
Compliments of the European Central BankThe post ECB | Demand or Supply-Driven? How Firms View Inflation Right Now first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Good evening,
It’s always great to be back in America and to be here among friends: friends of Europe, friends of defence. Friends of football.
The World Cup is over. And tonight we have the next big event in America: EU Defence Night!
It’s humbling to speak to you from the same stage as many world leaders: Konrad Adenauer, Henry Kissinger and George H. W. Bush. And Margaret Thatcher, Vaclav Havel.
When Bill Clinton spoke here, he spoke here for more than an hour. I will try my best to be a little bit shorter.
It’s great to be here at Georgetown University, one of the most famous and oldest universities in America.
Founded around the time America was born as a country. In 1789, the year George Washington was elected President.
Vilnius university, in my hometown, where I studied and did research in physics – was founded a little bit earlier. Around the time the first European settlers arrived in America, in 1579. Georgetown University started as a Jesuit university. Vilnius University also started out as a Jesuit academy. Maybe this is why I feel immediately at home, here at Georgetown University.
These historical surroundings inspire me to speak about the big historical changes we are living through, which will impact the Future of American Strategy, as it was discussed recently in a very interesting collection of essays by the Council of Foreign Relations. And which will impact the Future of European Strategy, which I want to discuss this evening.
It’s worth to remember, that at the beginning of this century the five biggest economies in the world were the United States, Japan, Germany, United Kingdom, and France. The United States number one. Today there is only one European country in that list: Germany.
In 50 years from now, by 2075, as a forecast by Goldman Sachs shows, the five biggest national economies will be China, India, the United States, Indonesia, Nigeria. No individual European countries at all. United States on number three.
The global balance of power is shifting. China and India are returning to global economic leadership, as they were before Columbus sailed to the “New World”.
For the USA it can be sensitive to go in the next 50 years from global economic leadership down to third place.
Of course, for us in Europe this is not a new experience. Two world wars, Soviet occupation and the Cold War changed our place in the world. We lost our global economic leadership at that time.
Our answer then was: to join forces. To join forces in the European Union. To put the destructive wars of the past behind us. Based on shared values, to work for freedom and prosperity.
And now after 70 years of European Unity, together, in the European Union, we have a GDP of around 23 trillion dollars.
And together, we are still in the top five. Together we are the second economy in the world. Second only after the United States.
Unity has made us much stronger.
Of course, at the end of the century collectively we shall be only Nr.4. But for us to drop down from Nr.2 to Nr.4 can be less painful. Since our history and your history gives us a lot of evidence, that unity makes us stronger, our answer today, in this changing world, must also be – to join forces across the Atlantic, with our historical partner – the United States. Our most natural ally.
One year after concluding our agreement on tariffs and trade it is worth repeating: the USA is the first economy in the world. The European Union is second economy in the world. As combined economies, even at the end of the century, we shall be able to keep global economic leadership. Perhaps.
Together we need to fear no adversary. But alone and divided, we are in danger.
The biggest adversary, the biggest threat on the continent of Europe is now Russia. We can only deter Russian aggression, together. Russia is spending 50% of its national budget on its war machine. Russia is outproducing Europe in many areas and even the United States and NATO. And will be capable of launching 10 millions drones next year.
The NATO Summit in Ankara made clear: Russia is the biggest long term threat for Europe and for NATO. To deter Russia we need a stronger Europe, for a stronger NATO. We need NATO 3.0.
Americans are asking Europe to take primary responsibility for its own conventional defence. Because the USA needs to shift to the Indo-Pacific. And this is what we are doing – we are taking responsibility. Eight European countries are already spending more than the United States on defence, in percentage of GDP. The Baltics and Poland now are spending more than 5% of their GDP on core defence. The United States with 3.2% is in the 9th place.
And if trends continue, by 2030 European countries in nominal terms, dollar by dollar, euro by euro will be spending more than the United States on defence: one trillion dollars. Europe is catching up.
A true defence big bang, making both Europe and NATO stronger.
We are now concretely discussing with our American partners the way forward. An orderly discussion on changing responsibilities.
What capabilities does America need to shift from Europe to other parts of the world? From where, and when?
Together we are identifying gaps. And the European Union can then support Member States to fill those gaps.
We need to remember that we are living through a century of major tectonic geopolitical shifts in the world.
Some of these are shifts in history that happen only once in 500 hundred years – like China and India returning to global economic leadership.
Other shifts – once in hundred years: like the dual transformation from transatlantic collective defence of Europe to much more European collective defence of Europe.
And at the same time – from the expeditionary doctrine, approved by NATO in 2012, back to the doctrine of territorial defence of Europe.
These tectonic geopolitical shifts demand from us a holistic approach to our defence readiness, which has three equally important pillars:
a)material defence readiness – weapons, finances, industry, production and procurement;
b)Institutional defence readiness – how we are organizing ourselves in Europe; how we are creating a European pillar of NATO;
c)and political defence readiness – how we are upholding our political unity, despite all the hybrid attempts to destroy it.
Today I will concentrate mainly on material defence readiness, but we shall not achieve full defence readiness  without all other pillars.
Our European material defence ramp up depends on three things.
First, on the European Union. Defence in Europe is the primary responsibility of Member States and NATO, but our European defence big bang is impossible without the European Union. The European Union offers EU added value, allowing Member States to operate on a European scale.
So even the smallest Member States can leverage the power of an entire continent of 450 million people. For example: our EU Space for Defence programme. Which no Member State can build alone. But gives all Member States world class satellite navigation, observation with intelligence data, and soon secure connectivity.
We are now mobilising this EU added value in different areas of our defence. For example, since 2023 we ramped up ammunition production in Europe to two million rounds a year – only possible thanks to an EU policy instrument – called ASAP. Without that we would still be producing only 200,000 rounds a year.
Also, we relaxed EU budgetary rules so Member States can spend more on defence. It would otherwise not be possible for many Member States to reach agreed NATO 3.5 % defence spending targets.
We are encouraging cooperation, joint production and joint procurement. With new EU instruments and money.
We are pushing for the creation of one integrated European defence market, because now we have 27 markets. And this is a big obstacle to ramp up production.
At the same time we have dramatically cut “red tape” for defence industry across the entire European Union. From four years waiting times in some cases for permits to build defence production facilities – down to 60 days. In other words: from 1460 days to 60 days. 25 times faster.
Now, we are also radically destroying obstacles to military mobility across the continent. So troops and equipment – also American ones – can quickly go where they are needed.
In short, we are mobilising our EU added value to create a strong European Pillar of a NATO 3.0. To make NATO and the Transatlantic alliance stronger.
Second, our defence ramp up depends on partnership between European defence industry and American industry.
Until  2035, during the next 10 years, Member States will spend 7 trillion euro on defence. And they can spend their national money when they like and where they like.
This creates for US defence companies a rapidly growing European defence market.
On top of that are EU defence investment programmes, which also offer opportunities for American industry.150 billion in SAFE loans, the 60 billion Ukraine defence loan.
Also the next EU multi-annual budget, from 2028 till 2035 – around 130 billion euro for defence and space.
EU defence funds, compared to Member States money for defence, are around 100 times smaller, and are as you say in America: “small potatoes”. Not trillions but only billions. Nevertheless good opportunities.
Now almost 90 US companies are taking part in our European defence programmes. There is still a lot of space, for America to invest in European defence industry.
But while Europeans buy 40% of their defence equipment in the United States, the US buys only 1 % in Europe.
For a true transatlantic defence industrial partnership we need also American industry and militaries to procure and to invest in Europe. True partnership in defence is much more than just licensing or co-production: it’s also sharing IP rights, joint research and joint development of new products, joint innovations and joint learning from Ukrainian defence industrial experience.
What is damaging possibilities of American defence industry on the European continent?
It is still ITAR.
European Member States are very cautious to buy defence products without guarantees they will be free to use them as they need. And some clever companies are already advertising: our products are ITAR free.
That is a key selling point for your competitors.
Finally, for our defence ramp-up we need to learn from Ukraine. Russia is continuing its war of aggression. But at growing cost. Ukrainian drones are stopping the Russian advance. Disrupting logistics behind the front line. And deep inland they are striking the oil supply that fuels Russia’s war machine.
For the first time since the fall of communism: long queues in Moscow, queues before petrol stations. Occupied Crimea is collapsing.
But the more Ukraine is prevailing, the more desperate Putin gets. And deadly. Every day there are drone attacks and ballistic missile attacks on Kyiv.
We now need to double down on our support for brave Ukraine.
It’s good that President Trump discussed the possibility of licensed production of anti-ballistic Pac3 missiles in Ukraine.
It was good also that at the NATO Summit in Ankara allies once again promised: 140 billion euro in support for defence of Ukraine for this year and next year.
The European Union and Member States will continue our support. As we have done till now, being the biggest supporter worldwide of Ukraine, with more than 180 billion euro since the Russian invasion.
Member States can now use 150 billion euro in SAFE loans to procure with Ukraine and for Ukraine. And now money from our 60 billion Ukraine Support loan, devoted for defence of Ukraine, is starting to reach Ukraine.
But now Ukraine not only receives support, but also gives support. Including for us, in Europe.
Secretary of State Marco Rubio said: Ukraine has the best army in Europe.
Ukraine has the best army not only because it has the best generals and bravest soldiers. But also because Ukraine has the best and most innovative industry and engineers.
And why is the Ukrainian defence industry the most innovative?
At the very beginning of the war, there was no military demand from traditional generals of Ukraine for drones and for innovative defence.
Only after some time, in Ukraine, innovative defence supply from a dynamic industry managed to transform military demand.
Thanks to innovative supply – Ukraine changed its war doctrine. Thanks to transformation of its war doctrine, Ukraine now is prevailing.
In Europe we need to repeat the same road of transformation: on supply side and on demand side. And finally to transform our defence doctrines.
It would be difficult to understand if we in Europe would not take it as our vital interest to integrate the best European military force and most innovative defence industry  of Ukraine into our European defence architecture.
Ukrainian industry produces “good enough” weapons for wartime conditions, to perform on the battlefield. European defence industry produces “haute couture” defence products. Products made for peacetime conditions. Products that are technologically advanced, but difficult to make, expensive and hard to scale up.
We must learn from Ukraine how to make “good enough” defence products. “Good enough” weapons that get the job done. And are cheaper. Weapons that can have rapid scale-up of production, rapid innovation, rapid repairs.
We are learning how to transform our industry and war doctrine from Ukraine. By putting Ukraine at the centre of our defence initiatives. Our initiatives on defence innovation, joint procurement and production.
And Ukraine is part of pan-European Defence projects like the Eastern Flank Watch, Air Defence Shield and the European Sky Shield against ballistic missiles.
Last week we signed the EU – Ukraine defence industrial pact. And the drone alliance between EU and Ukrainian industry was established to jointly produce drones and counter drones systems. And plans to build joint anti-ballistic system, based on Ukraine produced missiles and European seekers and radars were announced.
We are bringing together Europe’s industrial power and Ukraine’s innovation power.
In a changing world, Europe and America need each other. In the short run – to face the Russian threat. In the longer run – to face the shifting balance of power on a global scene.
We are natural allies.
When we Europeans look at America, we see ourselves, descendents of Europeans who built America, including many Lithuanians. Men like Charles Dennis Buchinsk, who came to this country very young, spoke at first only Lithuanian and Russian and served in World War Two in the US Air Force. We know him better as Charles Bronson. I saw him on the screen when I was very young in movies like the Magnificent Seven and other Western movies. And he showed us the freedom and opportunities of America.
And in Europe and America we look at the world in very similar ways. We are rooted in the same historical and cultural, and religious and philosophical traditions.
We have the same motto: You “from many one” – “E pluribus unum”. And we have: “Unity in diversity”.
This summer, an American Hollywood blockbuster is breaking all records by telling one of Europe’s oldest stories: the Odyssey.
We share the same values of freedom and democracy. We share the historical experience of resisting and defeating totalitarianism of Nazi Germany and the Soviet Union.
Now it falls on our generation to be put to the test. Now it is our responsibility, to meet the great challenge of our age.
To deter Russian aggression and prevent war. And to bring our transatlantic alliance through this turbulent century into the next century.
 
 
Compliments of the European Commission The post European Commission | Speech by Commissioner Kubilius at “EU Defense Night” first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

The European Commission took two decisions finding non-compliance by Google with the Digital Markets Act (DMA) for self-preferencing its own services on Google Search, and for putting in place restrictions on businesses to direct consumers to alternative, often cheaper, purchase channels on Google Play (steering). In this regard, the Commission issued Google a fine of €460 million and a fine of €430 million respectively.  
Self-preferencing on Google Search
Under the DMA, gatekeepers must not treat their own services more favourably in ranking than third-party services. They have to apply transparent, fair and non-discriminatory conditions to such ranking.
The Commission found that Google gives preferential treatment to its own services, including shopping, hotels, transport and sports results, over those of third parties in Google Search, thereby breaching its obligations under the DMA.
Google displays its own services more prominently in search results, including at the top of the search results page or by using enhanced visuals and filters, while similar third-party services do not have the same prominence.
Google’s anti-steering
Under the DMA, app developers that distribute their apps via Google Play should be able to inform customers – free of charge – of alternative, often cheaper, offers, and to direct them to those offers to make purchases, for example on websites or alternative app stores.
The Commission found that Google failed to comply with that obligation.
In particular, Google prevents app developers from freely communicating and promoting offers and concluding contracts with users in distribution channels of their choice, including third-party app stores.
While Google can receive a fee for facilitating the initial acquisition of a new customer by an app developer via Google Play, the level of the steering-related fees charged by Google and the length of the charging period for these fees went beyond what is considered compliant with the DMA.
As part of today’s two decisions, the Commission has ordered Google to bring the non-compliance to an end.
In particular, Google must implement measures to:

Treat third-party services that feature on Google’s search results in a fair and non-discriminatory manner by reference to its own services, and
Allow app developers distributing their apps via Google Play Store, both technically and contractually, to freely communicate, promote offers and conclude contracts with users not only within but also outside the Google Play app store.

The Commission notes that, after a constructive dialogue, Google has proposed and started testing changes to how it presents its own services on Google Search for free services such as shopping, hotels and flights. The Commission will monitor the implementation of these solutions which constitute substantial progress towards compliance. The Commission also notes that Google has proposed and started testing changes to how it presents shopping ads and content related services, such as sports. The Commission is currently assessing these changes and will continue its dialogue with Google in light of today’s decision. The Commission also takes note of Google’s proposals on how it plans to apply the principles of the decision to AI Overviews and AI Mode, on which dialogue will continue in light of today’s decision.
The Commission also notes that Google has rolled out changes related to Google’s steering terms. These constitute good progress towards compliance and will also be assessed in light of the cease and desist order of today’s decision.
The fines imposed today on Google take into account the gravity and duration of the non-compliance.
Next steps
Google is required to comply with the Commission’s decisions within 60 days, otherwise it risks periodic penalty payments of up to 5% of its total worldwide turnover.
The Commission continues to engage with Google to ensure compliance with its decisions and the DMA more generally.
Background
Google was designated as a gatekeeper in September 2023 for its online search engine Google Search. On 25 March 2024, the Commission opened non-compliance investigations into Google’s measures to prevent self-preferencing and into its steering rules. On 19 March 2025, the Commission informed Google of its preliminary view that the company was in breach of the DMA.
Google exercised its rights of defence by examining in detail all the documents in the two Commission investigation files and comprehensively replying in writing to the Commission’s preliminary findings.
The two non-compliance decisions were adopted after a thorough investigation, including feedback from market participants, and extensive dialogue with Google.
When calculating the fines, the Commission has assessed the gravity, duration and recurrence of the breaches and concluded that the level of fines imposed are proportionate and appropriate.
Google may decide to appeal today’s decisions.
 
 
Compliments of the European Commission The post European Commission | Google Fined €890 Million for Breaches of the Digital Markets Act first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

The ECB Blog | Why have energy prices risen less during the Iran war than after Russia’s invasion of Ukraine? This ECB Blog post compares the two episodes and explains the role of market buffers, demand and competition for LNG shipments.
The wars in Ukraine and Iran have both led to significant energy shocks and, as a result, rising energy prices. Yet the two shocks differ markedly in terms of both scale and market impact.[1] Most notably, although the disruptions to global oil and gas supplies have been considerably larger during the Iran conflict, the resulting price increases have so far been comparatively muted. To understand why, this post examines the dynamics of energy commodity markets.

The Iran war has disrupted oil supply more severely
Military strikes between the United States, Israel and Iran in late February 2026 led to the closure of the Strait of Hormuz. This interrupted the transit of around 20 million barrels per day (mb/d), equivalent to one-fifth of global oil supply. Although Saudi and Emirati pipeline networks have partially mitigated the disruption, the conflict has nevertheless resulted in an average supply loss of around 14 mb/d so far, representing 14% of global oil supply. By contrast, the war in Ukraine reduced oil supply by only around 1 mb/d, or 1% of global output, since most of Russia’s 10 mb/d of oil production continued to reach world markets despite the sanctions put in place (Chart 1, panel a).

Chart 1
Size of the energy shock and oil futures curve reaction

a) Size of the shock

b) Changes in oil futures prices and consensus forecasts at different horizons

(oil: mbd; gas: bcm/m)

(percent)

Sources: LSEG and authors’ calculations.
Notes: Panel a) compares energy market disruptions during the Ukraine war and the Iran war by showing the size of the realised shock (bars) and the volume of oil and gas at risk (diamonds). For oil, in the war in Ukraine, volume at risk refers to total Russian oil production in January 2022, while the realised shock corresponds to the peak decline in Russian oil supply observed in April 2022. For the Iran war, volume at risk refers to oil flows transiting through the Strait of Hormuz in 2025, while the realised supply shock accounts for mitigating factors, including the redirection of oil flows through Middle Eastern pipeline networks. For gas, volume at risk in the war in Ukraine refers to Russian pipeline exports to Europe in 2021, while the realised shock corresponds to the actual decline in Russian gas flows. For the Iran conflict, both the volume at risk and the realised gas shock refer to disruptions affecting Liquefied Natural Gas (LNG) volumes transiting through the Strait of Hormuz. The dashed yellow area for the Iran war represents Europe’s exposure to Middle Eastern LNG disruptions.
Panel b): Bars show changes in futures prices across different maturities. For the Ukraine war, changes are measured from 24 February 2022 to the initial price peak on 8 March 2022; for the Iran war, they are measured from 27 February 2026 to the initial price peak on 31 March 2026. Diamonds show changes in consensus forecasts over the same periods (February to March 2022 and February to March 2026, respectively). For consensus data, forecast horizons correspond to the closest futures maturities (e.g. 1Q ahead to 3-month futures, 2Q to 6-month futures, 4Q to 12-month futures). Expected price reactions for the Iran war are based on historical elasticities from Caldara et al. (2019). The latest observations are for 8 March 2022 (Ukraine war) and 31 March 2026 (Iran war).

The scale of the disruption is unprecedented. However, the oil price response in 2026 has been surprisingly restrained. This may be the result of hopes that the supply shortage will be temporary. By historical standards, a disruption of this magnitude would typically push up oil prices by as much as 105% (Caldara et al. 2019).
And yet, by early June, oil prices stood at only around USD 94 per barrel, 29% above their pre-conflict level, after retreating from a peak increase of more than 50%. Similarly, prices rose by around 30% at their peak following Russia’s invasion of Ukraine – a broadly similar response despite a far smaller supply shock. That increase was also short-lived, with prices stabilising at lower levels by August 2022.
Meanwhile, the oil futures market tells a similar story, with a smaller upward shift in the futures curve relative to the size of the shock during the Iran war. Another striking feature of this episode is that price increases have been concentrated in short-dated contracts. As a result, the curve moved into steeper backwardation: compared with 2022, near-term oil prices rose even more relative to longer-term prices in 2026 (Chart 1, panel b). This suggests that investors placed a higher value on immediate oil availability in 2026 than they did in 2022, pointing to elevated near-term upside risks to oil prices associated with the Iran war.
Oil markets were better prepared this time round
Alongside expectations of a swift resolution to the conflict, oil prices have also remained relatively contained thanks to a market that was better positioned to absorb supply disruptions than it was in 2022.

First, the oil market entered the conflict with an oil supply surplus of around 2.5 mb/d. Among other factors, this was underpinned by record US shale output and by China’s shift to electric vehicles.[2] This contrasts sharply with the conditions before the Ukraine war, when oil markets were already tight and the supply deficit stood at around 1 mb/d.
Second, inventories were significantly higher than in 2022. In addition to larger OECD stocks, China’s substantial stockpiling provided an extra buffer. Chinese inventories are estimated to have risen from 92 days of import cover in 2023 to around 115 days by early 2026. This helped to cushion the impact of supply losses.
Third, lower demand, particularly in Asia, helped contain price pressures in 2026. Key factors here were weaker Chinese petrochemical consumption and lower demand for jet fuel in the Middle East. In response to these developments, the International Energy Agency (IEA) revised its global oil demand forecast for the second quarter of 2026 down by 3 mb/d relative to its January outlook. It is currently projecting a year-on-year decline in demand of around 2%. This contraction is considerably larger than the one observed following the Ukraine war, when oil demand in the second quarter of 2022 was only 0.6 mb/d below the IEA’s pre-war forecast.[3]
Finally, policymakers have reacted more forcefully. The IEA’s coordinated strategic release of oil inventories of 400 million barrels far exceeded the 182 million barrels released in 2022.

Together, these factors help explain why a much larger supply shock has translated into a comparatively muted increase in oil prices.
Similar gas disruptions, smaller price increases
The contrast between the two crises can also be seen on the gas markets. While both conflicts resulted in supply losses amounting to around 9% of combined Asian and European gas demand, they differed in terms of the type of gas affected and the regions most directly exposed.
The war in Iran has disrupted the global LNG market. The Strait of Hormuz accounts for 20% of global LNG supply, equivalent to around 110 billion cubic metres (bcm) annually (Chart 1, panel a). By contrast, the war in Ukraine primarily affected pipeline gas, the impact of which was highly concentrated in Europe, with Russian exports to the region declining by 126 bcm in 2022.
However, as in the oil markets, the reaction of gas prices during the Iran war has been notably more muted than historical experience would suggest. By early June, Title Transfer Facility (TTF) natural gas prices, the most common European gas benchmark, had risen by 53% to €49 per megawatt-hour (MWh). Meanwhile, estimates based on historical data would suggest an increase of around 81%, broadly in line with the 79% price rise observed during the Ukraine war.
Given the similar size of the two supply shocks, this points to a more subdued market reaction in 2026. The two episodes also differ in terms of their underlying economic drivers. Adolfsen et al. (2026) suggest that the recent increase in TTF gas prices largely reflects precautionary demand shocks. In other words, price pressures increased owing to concerns over potential disruptions rather than actual supply losses, as Europe’s direct dependence on Middle Eastern LNG remains limited (Chart 2, panel a).
Conversely, during the 2022 energy crisis, while the initial increase in TTF gas prices reflected precautionary demand, it was subsequently amplified by physical supply disruptions, as declining Russian pipeline flows led to severe market tightness. The gas futures curve also indicated a more muted price reaction following the recent conflict. For instance, one and two-year futures rose by 12% and 2% during the Iran war, compared with 38% and 74% during the Ukraine conflict (Chart 2, panel b).

Chart 2
Gas price decomposition and gas futures curve reaction

a) Gas price decomposition

b) Changes in gas futures prices and consensus forecasts at different horizons

(percent)

(percent)

Sources: LSEG, Bloomberg, Gas Infrastructure Europe and authors’ calculations.
Notes: Panel a): The model is based on a weekly BVAR using the TTF gas price (1m future), inventories, NWE gas consumption, EU pipeline and LNG gas imports and the average of stock indices for gas price-sensitive sectors. The shocks are identified using sign and relative magnitude restrictions. The left panel covers the first months of the Ukraine war (February to August 2022), while the right panel covers the initial months of the Iran war (February to April 2026). The latest observations are for 28 August 2022 (left panel) and 10 April 2026 (right panel) (weekly data).
Panel b): Bars show changes in futures prices across different maturities. For the Ukraine war, changes are measured from 24 February 2022 to 31 August 2022; for the Iran war, they are measured from 27 February 2026 to the latest observation on 4 June 2026. Diamonds show changes in consensus forecasts over the same periods (February to August 2022 and February to May 2026, respectively). For consensus data, forecast horizons correspond to the closest futures maturities (e.g. 1Q ahead to 3-month futures, 2Q to 6-month futures, 4Q to 12-month futures). Expected price reactions for the Iran war are based on historical elasticities from Albrizio et al. (2023). The latest observations are for 31 August 2022 (Ukraine war) and 4 June 2026 (Iran war).

Weaker competition for LNG shipments contained gas prices
Several factors can help explain why gas prices have reacted more moderately in 2026 than during the Ukraine energy crisis.
First, the pre-shock conditions were favourable. In early 2026, TTF natural gas prices ranged between €28 and €40 per MWh. This reflected well-supplied markets following Europe’s diversification away from Russian gas and the expansion of LNG import capacity. By contrast, European gas markets were already under stress before Russia’s invasion in February 2022, with TTF natural gas prices standing between €80 and €90 per MWh and a heavy reliance on Russian pipeline gas. Meanwhile, storage levels were low and broadly comparable in both episodes (Chart 3, panel a).
Second, competition with Asia for LNG shipments was weaker in 2026. Although the type of disruption – LNG or pipeline – does not in itself determine the price response, market dynamics depend critically on the affected region’s ability to secure replacement supplies quickly. In both crises, the volumes previously supplied under long-term contracts had to be replaced through spot LNG purchases. In 2022, Europe bid aggressively for shipments while also contending with weak hydropower and nuclear generation. As a result, the spread between the Asian LNG benchmark (JKM) and the European gas benchmark (TTF) turned sharply negative. As gas became more expensive in Europe than in Asia, LNG shipments were diverted to Europe, where suppliers could get a better price (Chart 3, panel a).
By contrast, the JKM-TTF spread turned positive in March 2026, creating incentives to reroute LNG shipments to Asia. However, its much smaller magnitude points to less aggressive Asian buying than Europe’s in 2022, reflecting greater demand flexibility thanks to gas-to-coal substitution and China’s more diversified energy mix. As a result, Asian LNG demand has fallen much more sharply in 2026 than it did in 2022 (Chart 3, panel b).
Together, these factors have significantly reduced competition for LNG shipments and helped curb upward pressure on global gas prices, despite a disruption that has affected a substantial share of global LNG trade.

Chart 3
European and Asian gas market dynamics: 2022 vs 2026

a) Gas storage utilisation rate and gas spreads

b) Asian LNG imports

(left panel: percent of total capacity; right panel: USD per MMBtu)

(metric tonnes)

Sources: LSEG, Bloomberg, Gas Infrastructure Europe and authors’ calculations.
Notes: Panel a) shows the gas storage utilisation rates for 2022, 2025 and 2026, alongside the historical average and the range observed between 2011 and the latest observation. The latest observations are for 4 June 2026 (left panel) and 2 June 2026 (right panel).
Panel b) shows weekly LNG imports by Asian countries (China, India, Japan, South Korea and others) during the initial months of the Ukraine war (left panel, 24 February to the end of August 2022) and the Iran war (right panel, 27 February to the end of June 2026). “Average previous year” refers to the average level of LNG imports in the corresponding previous year (2021 and 2025, respectively). The latest observations are for 30 August 2022 (weekly data, left panel) and 26 June 2026 (weekly data, right panel).

Looking ahead
The comparison between the Iran and Ukraine wars highlights an important lesson: the size of an energy supply disruption alone does not determine the price response. Initial market conditions, inventories, demand flexibility and expectations can all be just as important.
Overall, expectations of a swift end to the conflict, stronger pre-crisis oil and gas market fundamentals and greater flexibility in Asian demand have so far helped contain the impact on energy prices. Nevertheless, conditions in the Strait of Hormuz—and, by extension, on global energy markets—remain highly volatile, particularly following the renewed surge in energy prices triggered by the resumption of strikes between the United States and Iran in July. A prolonged closure would gradually deplete the existing buffers and global inventories while forcing markets to abandon expectations of a rapid resolution, thus increasing the risk of renewed upward price pressures.
Conversely, a sustained reopening of the Strait could exert significant downward pressure on prices, particularly as oil and gas markets entered 2026 with expectations of sizeable supply surpluses. These expectations may have strengthened further, as the Iran conflict could encourage consumers to transition more rapidly towards alternative, more reliable energy sources, reducing their reliance on oil and gas.
The views expressed in each blog entry are those of the author(s) and do not necessarily represent the views of the European Central Bank and the Eurosystem.
References
Adolfsen, J.F., Lappe, M.S., Manu, A.S., Rößler, D., Schupp, F. and Stalla-Bourdillon, A. (2026), “Gas market shocks: Tracing the effect on Euro Area inflation expectations”, Journal of Macroeconomics, Vol. 8, 103760.
Albrizio, S., Bluedorn, J., Koch, C., Pescatori, A. and Stuermer, M. (2023), “Sectoral shocks and the role of market integration: The case of natural gas”, in AEA Papers and Proceedings, Vol. 113, pp. 43-46, American Economic Association, Nashville, May.
Burian, V. and Stalla-Bourdillon, A. (2026), “Non-linearities in oil prices: which conditions matter?”, Economic Bulletin, Issue 2, ECB.
Caldara, D., Cavallo, M. and Iacoviello, M. (2019), “Oil price elasticities and oil price fluctuations”, Journal of Monetary Economics, Vol. 103, pp. 1-20.

For an analysis of the differences in the macroeconomic conditions prevailing at the time of the two shocks, including labour market and fiscal conditions, see Arce et al. (2026), ‘’A tale of two energy crises – initial conditions matter’’, The ECB Blog, 3 June.
Recent evidence suggests that oil supply shocks have a more muted impact on prices when market balances are in surplus, see Burian, V. and Stalla-Bourdillon, A. (2026), “Non-linearities in oil prices: which conditions matter?”, Economic Bulletin, Issue 2.
See the IEA Oil Market Report, January 2022, January 2023, January 2026 and May 2026.

 
 
 
Compliments of the European Central Bank The post ECB | Energy shock: Why Oil and Gas Prices Have Risen Less Than Expected first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Corporate income tax (CIT) revenues remained at historically high levels in 2023, while corporate tax rates have broadly stablised, according to the 2026 edition of OECD Corporate Tax Statistics released today.
Across 135 jurisdictions for which data is available, CIT revenues accounted for 17.3% of total tax revenues and 3.5% of GDP on average. While slightly lower than in 2022, these levels remain above pre-pandemic levels and earlier historical peaks. Corporate tax revenues continue to represent an important source of public finances, particularly in developing economies.
Over the longer term, corporate tax revenues as a share of GDP have converged across income groups. In low-income jurisdictions, CIT revenues increased from 0.8% of GDP in 2000 to 3.1% in 2023, approaching the average level in high-income jurisdictions of 3.6%.
Large mulinational enterprises (MNEs) are a key source of corporate tax revenue, contributing an average of 44.5% of total corporate tax revenues in 2023, up from 42.8% in 2017 across the 60 jurisdictions providing Country-by-Country Reporting (CbCR) data.
The data also show continued stabilisation of statutory corporate income tax rates. The average statutory CIT rate across Inclusive Framework jurisdictions has remained broadly unchanged at around 21.2% between 2020 and 2026, following a prolonged decline from significantly higher levels in the early 2000s.
The publication includes an expanded set of anonymised and aggregated CbCR statistics, covering the activities of nearly 9 400 MNE groups headquartered in more than 60 jurisdictions. The enhanced dataset provides new insights into how revenues, profits and taxes are distributed across jurisdictions and among different categories of MNEs.
Indicators derived from the CbCR data continue to point to strong growth in global MNE profits and tax revenues. At the same time, some evidence points to ongoing mismatches between the location of profits and observed markers of MNE activity (tangible assets, number of employees). While some high-level indicators of mismatches show a slight increase in recent years, they remain below earlier peaks and continue to be substantially higher in investment hubs than in other jurisdictions.
The 2026 edition of Corporate Tax Statistics provides internationally comparable information on corporate tax systems in more than 170 countries and jurisdictions, including corporate tax revenues, statutory and effective tax rates, R&D tax incentives, withholding taxes, tax treaties and the implementation of BEPS measures.
To access the OECD Corporate Tax Statistics data, visit: https://www.oecd.org/en/data/datasets/corporate-income-tax-rates-database.html.
For further information, please contact the Communications Office in the OECD Centre for Tax Policy and Administration.

Compliments of the OECDThe post OECD | Corporate Tax Revenues Remain Elevated While Tax Rates Stabilise, According to New OECD Data first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.