Home›Global Markets›Trade & Tariffs›Pakistan and Bangladesh brace for faster costs from US…

Pakistan and Bangladesh brace for faster costs from US-Iran oil shock

Brent crude was up nearly 21.0% to $84.85 a barrel by late July, adding risk of quicker pass-through to domestic food, transport, and power prices.

Reported · Written up by our desk · Trade & Tariffs

Pakistan and Bangladesh could face a rapid inflation hit as the US-Iran conflict widens and raises the risk of another sustained spike in oil and diesel prices, analysts cited by SCMP Economy said.

Both economies rely heavily on imported fuel, leaving them with limited buffers if crude rises for longer, and Jamus Lim of ESSEC Business School Asia-Pacific said the weaker inventory cushion could make the impact on domestic prices “relatively quick.”

SCMP Economy added that oil markets are already pricing in the risk, with Brent crude up nearly 21.0% to $84.85 a barrel in Asian trading by Friday, compared with $70.18 on July 1, and WTI up about the same margin to $81.84.

The outlet also pointed to growing shipping risk beyond the Gulf, after a drone strike on gas vessels in Egypt’s Mediterranean port of Damietta on Wednesday heightened concerns for routes linked to the Suez Canal, a remaining outlet for Saudi oil.

Latest closeWTI crude $86.80 ▲3.8%|Brent $90.12 ▲1.2%

More like this

Sources