Transport-related prices, including gasoline and diesel, have climbed by nearly 32 percent since October 2020, and the potential escalation of conflict in the Middle East could trigger another surge in oil prices, analysts warn.
Local economist Dr. Philip Castillo highlighted Belize’s vulnerability in the global oil market, noting, “We [the country of Belize] are a relatively small importer;therefore, we are highly vulnerable to price changes.” This concern comes as Belize’s transport sector continues to face rising costs.
According to the Statistical Institute of Belize, the Transport category saw an overall increase of 2.2 percent between August 2023 and August 2024. The price of diesel rose by $0.67, from $11.84 to $12.51, while regular gasoline dropped slightly by 0.5 percent, and premium gasoline remained unchanged.
However, the current situation in the Middle East, particularly the conflict between Israel and Hezbollah, threatens to disrupt global oil supplies. Analysts warn that an escalation could lead to price shocks, especially if Iran, a key player in the region and a major oil producer, becomes directly involved. Iran’s control over the Strait of Hormuz, through which 15 percent of the world’s oil passes, adds to the concern.
In the event of a significant disruption, global oil prices could soar, increasing not only the cost of gasoline but also the price of consumer goods and transportation services. As Christopher Tang, professor at UCLA Anderson School of Management, pointed out, “If Iran got involved in this war, then it would disrupt oil supply worldwide.”
While U.S. oil production is currently at record highs, mitigating some of the global impacts, Belize remains particularly vulnerable due to its reliance on imported oil and gasoline. This potential instability in the global oil market could exacerbate Belize’s inflation, straining consumers already dealing with rising transport-related costs.
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