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- Nations across the world are taking steps to mitigate the impact of oil price spikes.
- These include flexible working arrangements and reducing non-essential journeys.
- Countries heavily reliant on Middle Eastern oil are particularly vulnerable to the war’s impact.
Governments around the world are taking measures to soften the blow of oil price spikes as the Iran war continues to raise concerns about prolonged supply chain disruptions.
Oil prices rose above $100 a barrel for the first time in four years over the weekend, following significant disruptions to shipments through the Strait of Hormuz since the outbreak of the war.
About 20% of the world’s daily oil supply passes through the sea passage, meaning that disruptions can have an outsize impact on global energy markets.
Thailand has already said it will stop exporting fuel to maintain domestic supplies, while other countries around the world are imposing restrictions and issuing advice to citizens in the face of the crisis.
From work-from-home arrangements to suggestions to avoid non-essential journeys, here are some of the steps being taken to reduce the impact of the oil price spike.
Philippines
The Philippines has taken several measures in order to bring down energy use, including a four-day workweek for government staff and orders to cut the use of electricity and fuel costs in government agencies.
Government offices were told last week to implement flexible working arrangements where practical, turn off lights and computers during lunch breaks, and adjust air conditioning unit thermostats to no lower than 75 degrees.
President Ferdinand Marcos Jr said in a video message on Friday that the four-day workweek, which began on Monday, would be temporary and does not include emergency services.
“With the expected global oil price increase, the government is preparing measures to reduce its impact on Filipino families,” the Facebook caption for the video said.
The Philippines is vulnerable to disruptions caused by the conflict, as it “relies on the Middle East for almost 90% of its oil supply,” according to ING Think.
Australia
While no official rationing has been implemented in Australia, local media in at least two of the country’s states reported that some fuel stations had begun limiting the amount of fuel customers can buy.
In comments to the media on Monday, Australia’s energy minister Chris Bowen said that there is no shortage of fuel in Australia, but there are “some supply chain issues which are really being caused by a spike in demand of people seeking to buy extra diesel.”
United Kingdom
The president of the AA, the UK’s largest motoring organization, advised drivers on Monday that although they “should not change their refuelling habits,” they could “consider cutting out some non-essential journeys and changing their driving style to conserve fuel.”
Edmund King, AA’s president, added: “Any time Brent Crude passes 100 dollars per barrel raises concern across the markets, for the haulage industry and drivers.
“There will be gradual increases in pump prices, but this shouldn’t happen overnight as fuel has been purchased at previous prices.”
Keir Starmer, the UK prime minister, said on Monday that the government would support citizens during the oil price spike.
“No matter the headwinds, supporting working people and their families with the cost of living is always top of my mind,” he said.
Read the full article here
