A month of conflict in the Middle East, its negative effects are felt in the global economy. The crisis erupted on February 28, when the United States and Israel launched joint attacks on Iran, setting off a series of events that cemented Tehran’s control over the vital Strait of Hormuz. This narrow strait, which connects the Persian Gulf with the Gulf of Oman and the Arabian Sea, remains one of the world’s most important energy routes. At its narrowest, it spans only 29 kilometers and has few navigable channels.Carrying about 20 million barrels of oil every day, almost a quarter of the world’s maritime trade, any disruption here has serious consequences. As stocks remain under pressure, countries are scrambling to manage the fall in stocks while helping consumers by coordinating policy responses. While some raised fuel prices, others changed taxes to protect consumers.
Vietnam
Vietnamese consumers breathed a sigh of relief as the country lowered fuel prices. Due to the sharp increase in the price of fuel, Vietnam started emergency measures to control costs. Authorities have suspended environmental protection taxes on petrol, diesel and jet fuel until mid-April, in a bid to stabilize the domestic market. The Ministry of Commerce described the move as “a quick and effective solution to stabilize the oil market and ensure the country’s energy security amid the escalating conflict in the Strait of Hormuz, which is causing the “biggest energy crisis”.
Venezuela
In Venezuela, prolonged high temperatures have increased pressure on an already strained electricity system, prompting the government to cut back operations. Interim President Delcy Rodriguez has announced a week-long suspension of work in the public sector, including education, as part of a plan to conserve electricity. He said: “During this Holy Week, I want to announce that I have ordered holidays on Monday, Tuesday, Wednesday, Thursday and Friday for the entire education sector,” adding that the country has endured “45 days of high temperatures.” Although essential services will continue to operate, this step reflects ongoing challenges in managing electricity demand.
India
In India, the government has taken several measures to protect consumers and companies from ongoing power supply problems. As the cost of refining continues to rise, the government has reduced the excise duty on petrol and diesel by Rs 10 per litre, despite the impact on the national budget. At the same time, foreign jobs were introduced with diesel fuel and an aircraft turbine to manage supply pressure. Officials insisted there was no shortage of petrol, diesel or LPG, dismissing allegations of disruption as a “coordinated campaign of misinformation.” Domestic availability of LPG remains stable, as production increases and countries are asked to expand commercial distribution.
Pakistan
Pakistan is facing rising fuel cost pressures, with the government adjusting prices on a voluntary basis as it tries to protect consumers. Kerosene prices increased by PKR 4.66 per liter to PKR 433.40, effective March 28, while petrol and diesel prices remained unchanged at PKR 321.17 and PKR 335.86 per litre. Officials said the decision aims to protect consumers from fluctuating global prices, with the government taking part of the burden by paying PKR 95.59 per liter for petrol and PKR 203.88 per liter for diesel to oil companies.At the same time, jet fuel prices have increased significantly, rising for the fifth time in 28 days. The latest increase of PKR 5 per liter has pushed jet fuel to a record of PKR 476.97 per liter, from PKR 188 at the beginning of March – a jump of PKR 288. Airlines have already hiked fares, with one-way domestic tickets on routes such as Karachi-Islamabad and Karachi-Lahore reaching PKR 40,000, while fares for “privilege seats” have gone up by 150%. Amidst these pressures, working methods are also changing according to energy pressure, with measures aimed at reducing overall fuel consumption forming part of a broader response.
Egypt
Egypt has introduced a series of temporary restrictions to reduce energy consumption as fuel costs continue to rise. Shops, restaurants and cafes must now close at 21:00 every night, along with measures such as reduced street lighting and working in isolation. The government called these “extraordinary measures” in response to increasing pressure on electricity supply. Egypt’s Prime Minister, Mostafa Madbouly, said that the country’s fuel costs have more than doubled in recent months. While tourism-related businesses are free, the wider economy is struggling, particularly due to dependence on imported fuel.
Sri Lanka
Sri Lanka is tightening energy use as supply disruptions continue to strain the country’s fuel system. With about 60 percent of its energy imported and limited resources lasting only about a month, authorities have returned a QR-based supply system. Weekly limits have been set, including eight liters for motorbikes, 20 for tuk-tuks, 25 for cars, 100 liters of diesel for buses and 200 for trucks. Fuel prices have also risen by about 33 percent since the start of the war, adding to the pressure on households.To curb consumption, the government introduced a policy of not working on Wednesday, closing offices and schools on that day. In addition to fuel shortages, Sri Lankans are also struggling with a depleted fertilizer supply that could drive up food prices, with estimates pointing to a potential increase of 15%, adding to health problems.
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