Situation on the fuel market – implications of the conflict with Iran on the global economy

The ceasefire between the United States, Israel and Iran temporarily calmed down the markets and reduced the price of crude oil on world markets. According to Andrzej Sikora, president of the Institute of Energy Studies, the effects of the six-week conflict in the Persian Gulf will be visible in the global economy for many months.

– The American-Israeli conflict with Iran caused the destruction of aluminum production potential in this region, stopped the global production of artificial fertilizers, and also disrupted the fuel market in many regions of the world. There are already problems with aviation fuel in EU countries, said Andrzej Sikora. The president of the Institute of Energy Studies points out that despite the ceasefire, tanker traffic in the Strait of Hormuz is small, only 4-5 ships pass through, while before the outbreak of the conflict there were 120-130 tankers and gas carriers a day.

– Iran destroyed two of the fourteen technological lines in the field that Qatar shares with Iran. Gas liquefaction installations in Qatar have been stopped, and their restoration will take 6-8 weeks in the best case scenario, and even a year in a pessimistic scenario. There will definitely be no LNG deliveries from Qatar to Poland in May, other directions include: United States. Disruptions on the hydrocarbon market may cause Russia to quickly return to the game as a supplier of oil and gas in Europe, says Sikora. The expert emphasizes that to this day, LNG from Russia is not subject to an embargo by the European Union.

The President of the Institute points out that the conflict in the Gulf may result in food problems, not only due to the increasing price of gas and, consequently, higher prices of fertilizers and agricultural products, but also problems with the availability of fertilizers themselves in the middle of the year, when preparations for autumn sowing will take place.

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