Hofbrauhaus Wolters, one of Germany’s oldest breweries dating back to 1627, has filed for bankruptcy, citing a shrinking beer market and rapidly escalating operating costs driven by soaring energy prices.

Germany’s economy has faced mounting pressure from high energy prices since Berlin began phasing out Russian oil and gas imports following the escalation of the Ukraine conflict in 2022. This strain has been compounded by recent spikes in crude oil prices triggered by the US-Israeli war on Iran.

Under self-administration insolvency proceedings, Hofbrauhaus Wolters will remain under its current management while a court-appointed administrator oversees restructuring efforts. Employees retain their positions as the brewery pivots toward producing non-alcoholic beverages instead of traditional beer.

Nationwide beer consumption plummeted to record lows in 2025, with the company identifying rapidly rising energy costs as a primary factor in its insolvency decision. Germany endured recessions in 2023 and 2024, followed by near-stagnation in 2025 and an estimated growth rate of just 0.5% this year. Automotive giants such as Mercedes-Benz and BMW have also struggled to adapt to heightened energy costs and weaker demand.

Simultaneously, Berlin continues to allocate substantial resources to support Ukraine’s military efforts while accelerating its own rearmament program. Since 2022, Germany has committed over €96 billion ($109 billion) in military aid to Ukraine and launched a €100 billion national defense initiative. Last year, Germany’s central bank warned of an impending record budget deficit, citing increased military expenditures as a key driver.