Stagflation fears echo 1970s neoliberal pivot

Economists warn that a potential closure of the Strait of Hormuz could trigger stagflation—a combination of stagnation and inflation—reminiscent of the 1970s crisis that paved the way for neoliberalism. The strait's blockade would reduce global oil supply by ten percent, sparking price wars among nations. IEA chief Fatih Birol cautioned the current crisis could surpass previous ones in severity. Germany, despite low direct oil imports from the Persian Gulf, already feels the impact through rising energy prices. The article draws historical parallels to how stagflation in the 1970s led to the rise of neoliberal economic policies.