If war in the Middle East lasts, Serbia, just like the rest of the world, will feel the consequences when it comes to energy supplies. The Strait of Hormuz, which is blocked, and through which a fifth of the global is transported oil consumption, could cause shortages. And when there are shortages, price increases are inevitable.
Since Israel and the United States attacked Iran, oil prices have seen a dramatic rise. And not only that, The Strait of Hormuz is blocked, that is, no ship can pass there anymore. Energy expert Željko Marković points out that he would be in trouble for the New Economy, the whole world could be found, and in that case we wouldn't be isolated either.
This, of course, includes shortages, and therefore a jump in prices, writes New Economy.
The first problem is that the Oil Industry of Serbia (NIS) predominantly uses oil from Iraq.
"Iraqi oil makes up 40 percent, and the rest is from Azerbaijan, Kazakhstan, Libya... Obviously, Iraq cannot deliver oil, because it was carried out through the Strait of Hormuz. It remains to be seen how the NIS will regulate it in our country," says Marković for New Economy.
He adds that the US has agreed to ensure the passage of tankers. How far-reaching the consequences will be depends on when it will happen.
"In the first term, prices are rising, but certainly there are stocks that are still being consumed. Everything will depend on the duration of the conflict and whether it will be possible to compensate for the 20 percent of world consumption that passes through there," concludes Marković.
Namely, 20 percent, or a fifth of the world's oil consumption is delivered via the Persian Gulf, through the Strait of Hormuz. The general secretary of the Association of Oil Companies of Serbia, Tomislav Mićović, explains that oil from Iran, Iraq, Kuwait, the United Arab Emirates, as well as gas from Qatar, is transported there.
"This war can have far-reaching consequences on the entire market. The fact that the Strait of Hormuz is blocked is a logistical problem, because 20 percent of oil consumption passes through there. And when the sources that can make up for it are collected, we cannot count on them. Russia is important there, but it cannot fulfill its potential due to sanctions. Sources in Latin America are negligible," Mićović explains for New Economy.
The key thing, he emphasizes, is time.
"If the conflict lasts for several days, long-term consequences will not be felt, especially since no export terminal was affected. Admittedly, the refinery in Saudi Arabia, from which derivatives are shipped to the Mediterranean, was damaged, so they could be in trouble, but it is significant that no export terminal was destroyed," says Mićović.
Photo: AP Photo/Jon Gambrell, FileThe Strait of Hormuz
There will be oil, but the question is at what price
Energy expert Velimir Gavrilović tells Nova Ekonomi that there are several factors that affect the supply, and that Serbia will not run out of oil derivatives - but the question is how much they will cost.
"Prices on the stock market are jumping, because there is a deficit of 20 percent at the global level. The question is how long this will last, whether it will be short or prolonged," says Gavrilović.
If the current conflict is prolonged, Gavrilović does not have any optimistic expectations.
"If that happens, I believe we will have a global energy crisis. Prices will reach $100 per barrel, it shouldn't be more than that, and if the conflict ends, I expect up to $90. Of course, it will also depend on the reaction of OPEC, from the countries that have their own production," says Gavrilović.
He adds that the question is whether the European Union will stick to its decision to stop the supply through Russia, or whether it will be abolished, at least temporarily.
"That could ease the price pressure, it would be a simple and quick solution. The question is how much the US controls exports from Venezuela. Also, another problem is gas, which also comes from the countries of the Persian Gulf," says Gavrilović.
According to him, the winners will be companies that have sources outside the Persian Gulf.
Vučić announced state measures
Serbian President Aleksandar Vučić announced that measures will be prepared to ensure energy security due to the uncertainty surrounding the war in the Persian Gulf.
"We will all have hell in Europe if the war continues. My idea is to find measures to subsidize us in the next month, because we must not let the price of oil go wild. We will adopt measures, we will inform you about everything on Saturday, Sunday," said Vučić.
Mićović explains to Nova Ekonomija that the state has mechanisms with which it can regulate prices, which are sure to rise.
Photo: WikipediaThe Strait of Hormuz
The state can reduce excise taxes
"It is very important that the state knows that the price of fuel at gas stations must not be at a level that prevents the purchase and delivery of fuel. If the final price of fuel is too high, then the state can reduce its share - the excise tax," says Mićović.
Namely, our interlocutor explains that the Government has the possibility, in accordance with the Excise Law, to temporarily reduce the amount of excise duty by 20 percent, and then, when the crisis period passes, return it to the previous level. By the way, as of February 15, the excise tax on unleaded gasoline amounts to 72 dinars per liter, while this levy on leaded gasoline amounts to slightly more, 76,55 dinars.
"It is not enough for prices to remain at this level. Fuel would have to become more expensive," concludes Mićović.
By the way, fuel prices at pumps in Serbia are controlled by the state. Every Friday, the maximum prices of diesel and gasoline are published, which are valid for a week. On January 24, the duration of the regulation was extended for another 60 days.
What is happening in Iran?
On February 28, the US and Israel attacked Iran. US President Donald Trump announced that the reason is that "Iran threatens the security of the US and its partners". A girls' school in the south of Iran was also attacked, and at least 148 girls died in the attack. Satellite images analyzed by CNN show that the affected school is about 60 meters from an Iranian military base.
Shortly after the first attacks, Iran's Revolutionary Guard announced that no more ships were allowed to pass through the Strait of Hormuz.
It was also announced that Iran's supreme religious leader Ayatollah Ali Khamenei was killed. The former president of Iran, Mahmoud Ahmadinejad, who led the country from 2005 to 2013, was also killed. After that, Trump announced that a total of 48 Iranian leaders had been killed. And the American president revealed how long the attack on Iran could take.
"We thought it would be four weeks or so," Trump told the Daily Mail in a brief phone call.
The nuclear site in Natanz in the central part of Iran was also bombed, satellite images published by the American company Vantor showed. In the bombing on the night between March 1 and 2, three buildings were destroyed.
