By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Pierre Wunsch on Tuesday warned against broad support measures to shield households from the Iran-driven energy shock, arguing that such steps would amount to “pouring oil on the fire.”

Wunsch, who heads the National Bank of Belgium, spoke in Belgian parliament as he presented the central bank’s 2025 annual report.

He warned that Belgium would be especially exposed if the conflict were to drag on. “We would be really vulnerable, and it would only be a matter of time before the markets react,” Wunsch said.

The Belgian central banker further argued that the country no longer had the fiscal space it had during earlier crises. “The money is exhausted,” he said.

In that context, Wunsch warned that if the war with Iran were to persist, Belgium’s budget deficit could rise to 6% or 7% of GDP.