The armed conflict in the Middle East has already provoked a sharp jump in oil prices. For Ukraine, this means a potential increase in fuel prices and pressure on prices. Viktor Halchynskyi, former spokesman for NJSC "Naftogaz of Ukraine" in the Lviv region, told UNN about this in a comment.
Why did the market react so sharply?
The expert explains: the market reacts not only to the fact of hostilities, but to the risks of losing huge volumes of oil and problems with transit.
The conflict involves countries with some of the world's largest oil reserves. These are Iran, Saudi Arabia, the Emirates, Iraq, Kuwait. We are talking about colossal volumes. If these supplies are limited or blocked due to the war, the market instantly reacts with a price increase
The second factor is the Strait of Hormuz, through which a significant part of the world's oil transit passes.
It's not just about the oil itself, but about its export through the Strait of Hormuz, through which 27% of oil passes. This is a key artery of the world market. If it is blocked by missile strikes or drone attacks on tankers, it automatically raises quotes. Even the risk of such a scenario pushes the price up
According to the expert, the strait was actually partially blocked over the weekend, but with the start of trading, the movement of vessels resumed, which somewhat stabilized the situation.
Can a barrel cost 100-150 dollars?
Today, a barrel costs about $76, although recently the price was approaching $80. However, a scenario of rapid growth to $100-150 is not ruled out.
This is possible for two reasons. First, if Iran continues to actually block the Strait of Hormuz with missile strikes, not by fleet, but by air attacks. Second, if the conflict drags on for more than a week or two and the high intensity of strikes continues
He draws attention to the strikes on the region's oil refining infrastructure.
Iran attacked Saudi Arabia's oil refining and gas processing facilities. This is a signal that the factor of disabling the oil production and oil refining industry of the Middle East is being seriously considered. If the strikes are successful and prolonged, in a month there may simply be nothing to transport
Will Russia benefit from high prices?
At first glance, the price increase should be beneficial for Russia as an exporter. But, according to Halchynskyi, the situation for Moscow is not so unambiguous.
They would have had a chance to reap maximum dividends from the high price. But they themselves lost it. The most effective are the so-called kinetic sanctions - strikes on oil terminals and logistics hubs. Plus sanctions restrictions, shadow fleet, discounts. There is oil, but it is difficult to transport it, and it has to be sold at a discount
The expert adds: due to the war, Russia lost the opportunity to fully take advantage of the conjuncture.
What does this mean for Ukrainians?
Most Ukrainians are concerned about the practical question - when and how this will affect their wallet.
Ukraine imports most petroleum products. Therefore, a global jump in oil prices will sooner or later affect our market as well. Not immediately, because reserves have been formed, the market is working. But in the long term - two or three months - this may be reflected in prices at gas stations
He emphasizes that fuel sellers will factor risks into prices, even if purchases were made earlier.
Some players may try to speculate, but supply and demand usually balance the situation. Our market is more or less formed. Therefore, a sharp jump "tomorrow morning" is not expected, but a tendency for gradual growth is possible
Is a price drop possible in the future?
Halchynskyi also outlined the opposite scenario: if the regime in Iran changes, and sanctioned countries like Venezuela and Iran return to the market.
If Iran becomes a secular state and can fully export, and Venezuela modernizes its industry, supply will increase. If these countries do not join OPEC, competition will arise, which can lower the price. But this is a matter of years, not months
In summary, the expert emphasizes: the current price jump is a reaction to risks, not to a real shortage. However, if the conflict drags on or the extraction infrastructure is destroyed, Ukrainian consumers will feel it in the form of more expensive fuel, and later - in the prices of goods and services.
Recall
Analysts expect oil prices to remain high in the coming days amid escalating conflict in the Middle East, assessing the impact on supplies, especially those through the Strait of Hormuz, which accounts for more than 20% of global oil volume.