ECB on High Alert as Middle East Tensions Send Oil Prices Soaring

The recent conflict between Iran and the United States has slowed traffic through the Strait of Hormuz to a trickle, restricting energy exports on a waterway that carries about a fifth of the world's oil and natural gas.

This development has put the European Central Bank (ECB) on alert ahead of its rate-setting meeting on Thursday.

The ECB raised interest rates in June by a quarter of a percentage point to 2.25 percent, citing the near-total closure of the strait and rising oil prices.

However, with renewed fighting between Iran and the US, energy prices have reversed their decline since the signing of the memorandum of understanding between the two nations.

This has sparked fears that eurozone inflation, which eased to 2.8 percent in June, might pick up again.