OECD: energy price shock will nullify real wage increases in Italia

According to the economic outlook of the OECD presented yesterday in Paris, Italy's GDP growth is expected to settle at 0.5% in 2026, due to "the new energy price shock that weighs on household consumption, investment and exports". But a significant finding is that 'higher energy prices will cause inflation to rise, wiping out the recent rise in real wages'. Also according to the OECD, in 2027, "the fall in energy prices and the easing of uncertainties will bring growth to 0.6%. Italia's prospects,' the OECD points out, 'are relatively exposed to the evolution of the conflict in the Middle East, given the high share of energy produced from imported fossil fuels and the weight of exported manufacturing production'.

"The first signs of a gradual recovery of the economy were looming between late 2025 and early 2026, when the sharp rise in energy prices and instability did not begin to dent confidence," writes the OECD, highlighting the impact of the war in the Middle East on Italia's economic situation. In the report dedicated to Italia, the international organisation points out that Italy's GDP "advanced by 0.2% in the first quarter of 2026 compared to the previous quarter, supported by the increase in investments and production linked to pharmaceutical products and energy and digital transitions. In 2026,' the OECD continues, 'firms indicated an improvement in their orders, while the increased amounts released under the NRP had a stimulating effect on construction activity and tax incentives supported residential investment'. As for the Milan-Cortina Olympic Games, 'they temporarily boosted activity in the services sector as well as exports'. However, according to the OECD, the start of the conflict in the Middle East caused a 'sharp deterioration in consumer and business confidence. Rising energy prices brought the inflation rate to 2.8 per cent in April'.

As for exports, "they recorded a drop in volume at the end of 2025, particularly those to eurozone and US markets, before recovering slightly at the beginning of 2026". Italia 'is more dependent than other major eurozone countries on refined oil and natural gas (a quarter and 11 per cent of total supply, respectively) channelled through the Strait of Hormuz'.

The 'global' economy is under pressure again. Shipping disruptions in the Strait of Hormuz, coupled with damage to energy infrastructure, have caused a sharp rise in energy prices and increased costs of fertilisers and other essential industrial inputs. These price increases are fuelling inflationary pressures, eroding confidence and weighing on household demand and economic activity," writes OECD Chief Economist Stefano Scarpetta in his introductory message. 'The evolution of the conflict in the Middle East,' Scarpetta continues, 'remains uncertain, but its economic consequences are likely to persist for some time, even after its resolution.