The United Nations Conference on Trade and Development (UNCTAD) said fuel-price increases varied substantially across countries because of differences in taxes, subsidies, exchange rates and domestic pricing policies.

Diesel prices in Nigeria increased by about 83% between late February and the end of August, compared with 9% in Ireland.

Petrol prices rose by approximately 51% in Myanmar but only 3% in Sweden.

Brent crude increased from about $70 a barrel in January to more than $120 in March after the Strait of Hormuz was closed.

The maritime route ordinarily carries about one-fifth of global oil supplies.

Prices declined between April and June as diplomatic negotiations progressed but rose again after talks collapsed and fighting resumed.

Oil futures indicate that prices could remain elevated until the end of 2026, maintaining pressure on businesses and households through increased fuel and transport bills.

Higher fuel prices also affect people who do not buy petrol or diesel directly because transport costs are passed through to food and other essential goods.

Previous research involving developing economies found that a $0.25 increase in fuel prices per litre could reduce average household purchasing power by more than 5%.

Fuel-importing countries face particularly serious risks because higher oil prices increase foreign-currency requirements and weaken external balances.

Net fuel imports were equivalent to one-quarter of Cabo Verde’s gross domestic product in 2023 and nearly one-fifth of Lebanon’s.

As fuel bills increase, governments and businesses have less money available for food, medicine, machinery and other imports.

Governments already facing high debt and constrained budgets also have limited capacity to provide subsidies or other protection to households.

UNCTAD called for more diversified energy systems and greater investment in affordable renewable power to reduce vulnerability to future geopolitical shocks.

Renewable sources such as wind and solar cannot be depleted and are not directly exposed to disruptions affecting international fossil-fuel shipping routes.

More than 90% of new renewable-energy projects are cheaper than the least expensive new fossil-fuel alternatives, according to UNCTAD.

Expanding renewable power could therefore strengthen energy security, reduce import dependence and protect developing economies from future commodity-price shocks.

–UN/ChannelAfrica–