Countries across the world are escalating stopgap measures to deal with the energy crisis as the disruption of critical maritime routes has led to dwindling strategic reserves and disrupted economies.
- •Ethiopia has asked all public institutions and state-owned enterprises to put non-essential employees on annual leave in an attempt to mitigate the fuel shortage.
- •At a press conference in Canberra, Australia’s Prime Minister Anthony Albanese has announced a tax cut on fuel for three months, as the price of crude oil has increased.
- •Across the world, economies are staring at multifold crises triggered by the latest, ongoing conflict pitting Israel and the United States against Iran.
“We understand the cost pressures for people are very real as the impact of the war on the other side of the world plays out right here,” Albanese said, according to a report by Al Jazeera.
“We’re acting now to be over-prepared,” he added.
In Kenya and Uganda, energy regulatory bodies have pushed back on oil marketers who have sought to either raise prices or hoard fuel supplies. Governments across East Africa have moved to reassure the public that there are enough supplies, partly to curb hoarding and panic buying. With heightened demand for the reduced oil in transit, options such as the Dangote Refinery have gained renewed interest within and outside the continent.
"The closest recent analogue to the current environment remains the 2022 commodity spike, when Brent traded consistently above US$ 100. That episode coincided with several additional pressures: a general election, severe drought, tightening monetary policy and the expiry of COVID-era loan restructurings," Henok Eyob, Managing Director and Partner at Boston Consulting Group (BCG), writes in this analysis for The Kenyan Wall Street.
Some countries such as Sri Lanka have placed limitations on how much fuel motorists can buy. In Myanmar and Cambodia, the limitations are working on an ‘odd-even’ rule where odd and even numbered plates can buy fuel on alternate days. The rationing plans are only stopgap measures, with some governments such as Ethiopia either pushing for staff to go on leave, or re-instituting work-from-home policies that were first implemented at a wide scale during the pandemic years. New Zealand is mulling 'car free' days, where citizens choose a day in the week where no one is allowed to drive.
The current crisis has triggered more cooperation between central governments and devolved units. In addition to the national tax cuts in Australia, for example, some states such as Victoria have made public transport free.
While some countries are more vulnerable than others, the energy crisis has rattled markets and increased fears over a global recession.
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