Every new war and conflict in the world results in a rise in prices in Bosnia and Herzegovina (BiH). Announcements are already coming in, we will be filling up fuel at higher prices.
The price of crude oil is rising. For now, 7%. The increase is visible, but it is also undeniable that the price is still lower than last year’s. However, in BiH, there are already clear announcements that fuel will become more expensive.
“Drivers should be concerned not only by that news, but since the beginning of the month there has been a constant increase and regardless of what is happening today between Israel and Iran, prices definitely need to go up. And they will, over 2.30 BAM, and that will happen in the next day, two, or three,” said Djordje Savic, Chairman of the Oil and Oil Derivatives Trade Group of the Republika Srpska (RS) Chamber of Commerce.
Prices in the Federation of BiH (FBiH) entity are already a bit higher than that amount.
“They always do that as standard, whenever something happens in the world it immediately gets more expensive, and it doesn’t drop. It’s always like that.”
“I was just commenting with a colleague now it will go to 2.50 BAM, well look… it’s not justified, it immediately gets more expensive. When it should go down, then there is an excuse why it can’t.”
“It’s to be expected and when the war in Ukraine started it was like that. There will be other immediate price hikes… electricity, oil, then other prices go up too,” citizens say.
The announcement of a fuel price increase is premature because it takes a month from the moment crude oil becomes more expensive until it is delivered to the distributors, explains economic analyst Zoran Pavlovic. Because of that, there is justified suspicion that fuel reserves will be sold at higher prices, even though they were procured at lower ones.
“Now it’s just a question of whether and to what extent inspection bodies will control whether the goods really arrived at the new price or fuel is being used and distributed that was procured at lower prices. Talking about two price hikes in advance is the preparation of the market for an increase that traders like to use to earn more,” explained Pavlovic.
The tensions between Israel and Iran are shaking the markets. Iran produces over three million barrels of crude oil daily; most of that oil is sold to China. If the conflict escalates, the price could rise by more than seven dollars per barrel. A huge problem would be caused by the blockade of one of the world’s most important oil “arteries” – the Strait of Hormuz. Iran has announced that it is seriously considering that move. This strait is located between Oman and Iran where most of the oil from this region passes, as well as large quantities of liquefied natural gas.
“That is about 25% of the world’s oil and that could also bring us to a situation where we will not have enough derivatives. If the conflict escalates, the price of a barrel could go over 100 dollars. The stock exchange will play a dirty role there and that’s how it is. I hope the conflict will be stopped because I see no end there, where civilians are being killed on both sides,” emphasized Davor Stern, an energy expert.
In the event of a significant global increase in the price of oil, the world will once again face major inflation, analysts warn. With each new missile fired, we are getting closer to that, N1 writes.
