The conflict in the Middle East will inevitably affect the BiH economy in the context of rising fuel prices – currently there is no signal that there could be a real shortage of fuel, but rising prices is a real possibility, especially if the conflict deepens and affects the global supply of oil, it was said to Fena in the Foreign Trade Chamber of BiH.
The Chamber states that fuel shortages are not expected in the short term, but price increases and greater price volatility certainly are. Therefore, there is no risk of physical shortages due to interruptions because BiH does not import crude oil directly from war zones, derivatives are procured through regional distributors and refineries in the region, while price increases are inevitable.
They believe that in the event of a longer duration of the war, there will inevitably be an increased cost of energy and transport, and therefore likely inflationary pressure, an overall increase in business costs (companies that rely on the import of raw materials/energy could have a reduced profit margin or a disruption in trade flows) and an increase in risks in investments and the business climate.
VTK emphasizes that the consequences of this conflict have already been recorded – fuel prices at the pumps have increased, which directly affects business in BiH, primarily through the increase in energy prices and uncertainty in business.
They say that Bosnia and Herzegovina does not have a strategic dependence on oil, we do not import key food products from war-affected countries, the energy system is not connected to the local infrastructure, nor does industrial production in BiH depend exclusively on war-affected countries. The real risk in this case for Bosnia and Herzegovina is the global increase in energy prices.
“So, if the conflict remains regional, without a wider energy escalation, the drop in exports and imports would be minimal and short-term. If there is a wider energy shock, a drop in exports of three to seven percent is possible, indirectly through a drop in demand in the EU, with a simultaneous rise in inflation,” according to VTKBiH.
