EBRD: Jordan among countries most affected by rising energy prices
The European Bank for Reconstruction and Development (EBRD) predicted that Jordan would be among the economies most affected by the repercussions of rising energy prices and supply chain disruptions due to the conflict in the Middle East, along with countries such as Lebanon, Iraq, Egypt and Turkey.
The bank said in a report reviewed by Ammon that it is likely to lower growth forecasts for some emerging markets by up to 0.4 percentage points in its next economic report scheduled for release in June, if energy prices remain at high levels.
The EBRD in its report entitled “Potential economic impact of the conflict in the Middle East”, expects the conflict in the Middle East to weigh on economic activity across its regions by way of higher energy and fertiliser prices, disruptions to trade and tourism flows, and tighter financing conditions.
“The conflict shows how quickly geopolitical shocks can ripple through energy markets, supply chains and financial conditions,” said Beata Javorcik, EBRD Chief Economist.
“Rising energy prices come at an already challenging time for the European manufacturing sector, while the broader fallout from the conflict is likely to strain government budgets already overstretched by high defence spending in central Europe and elevated debt-servicing costs in the southern and eastern Mediterranean and sub-Saharan Africa. The effects of the conflict are likely to linger beyond the end of hostilities.”
Energy prices have increased sharply as a result of recent disruptions to production and transport routes in the Persian Gulf. Even though oil and gas prices remain below historical peaks, short-term demand for energy is relatively inelastic and prices could rise significantly further should disruptions persist.
The analysis notes that if oil remains above US$ 100 per barrel for a prolonged period and supply-chain disruptions involving chemicals and metals continue, global growth could be reduced by at least 0.4 percentage point, while inflation could rise by more than 1.5 percentage points. Under such a scenario, growth forecasts for the EBRD regions could be cut by up to 0.4 percentage point in the Bank’s next outlook.
EBRD economies with high energy, fertiliser and food import dependence, strong links to the Gulf and limited fiscal space are likely to be most affected. These include Egypt, Iraq, Jordan, Kenya, Lebanon, Moldova, Mongolia, North Macedonia, Senegal, Tunisia, Türkiye and Ukraine, according to the report.
The European Bank for Reconstruction and Development (EBRD) predicted that Jordan would be among the economies most affected by the repercussions of rising energy prices and supply chain disruptions due to the conflict in the Middle East, along with countries such as Lebanon, Iraq, Egypt and Turkey.
The bank said in a report reviewed by Ammon that it is likely to lower growth forecasts for some emerging markets by up to 0.4 percentage points in its next economic report scheduled for release in June, if energy prices remain at high levels.
The EBRD in its report entitled “Potential economic impact of the conflict in the Middle East”, expects the conflict in the Middle East to weigh on economic activity across its regions by way of higher energy and fertiliser prices, disruptions to trade and tourism flows, and tighter financing conditions.
“The conflict shows how quickly geopolitical shocks can ripple through energy markets, supply chains and financial conditions,” said Beata Javorcik, EBRD Chief Economist.
“Rising energy prices come at an already challenging time for the European manufacturing sector, while the broader fallout from the conflict is likely to strain government budgets already overstretched by high defence spending in central Europe and elevated debt-servicing costs in the southern and eastern Mediterranean and sub-Saharan Africa. The effects of the conflict are likely to linger beyond the end of hostilities.”
Energy prices have increased sharply as a result of recent disruptions to production and transport routes in the Persian Gulf. Even though oil and gas prices remain below historical peaks, short-term demand for energy is relatively inelastic and prices could rise significantly further should disruptions persist.
The analysis notes that if oil remains above US$ 100 per barrel for a prolonged period and supply-chain disruptions involving chemicals and metals continue, global growth could be reduced by at least 0.4 percentage point, while inflation could rise by more than 1.5 percentage points. Under such a scenario, growth forecasts for the EBRD regions could be cut by up to 0.4 percentage point in the Bank’s next outlook.
EBRD economies with high energy, fertiliser and food import dependence, strong links to the Gulf and limited fiscal space are likely to be most affected. These include Egypt, Iraq, Jordan, Kenya, Lebanon, Moldova, Mongolia, North Macedonia, Senegal, Tunisia, Türkiye and Ukraine, according to the report.
The European Bank for Reconstruction and Development (EBRD) predicted that Jordan would be among the economies most affected by the repercussions of rising energy prices and supply chain disruptions due to the conflict in the Middle East, along with countries such as Lebanon, Iraq, Egypt and Turkey.
The bank said in a report reviewed by Ammon that it is likely to lower growth forecasts for some emerging markets by up to 0.4 percentage points in its next economic report scheduled for release in June, if energy prices remain at high levels.
The EBRD in its report entitled “Potential economic impact of the conflict in the Middle East”, expects the conflict in the Middle East to weigh on economic activity across its regions by way of higher energy and fertiliser prices, disruptions to trade and tourism flows, and tighter financing conditions.
“The conflict shows how quickly geopolitical shocks can ripple through energy markets, supply chains and financial conditions,” said Beata Javorcik, EBRD Chief Economist.
“Rising energy prices come at an already challenging time for the European manufacturing sector, while the broader fallout from the conflict is likely to strain government budgets already overstretched by high defence spending in central Europe and elevated debt-servicing costs in the southern and eastern Mediterranean and sub-Saharan Africa. The effects of the conflict are likely to linger beyond the end of hostilities.”
Energy prices have increased sharply as a result of recent disruptions to production and transport routes in the Persian Gulf. Even though oil and gas prices remain below historical peaks, short-term demand for energy is relatively inelastic and prices could rise significantly further should disruptions persist.
The analysis notes that if oil remains above US$ 100 per barrel for a prolonged period and supply-chain disruptions involving chemicals and metals continue, global growth could be reduced by at least 0.4 percentage point, while inflation could rise by more than 1.5 percentage points. Under such a scenario, growth forecasts for the EBRD regions could be cut by up to 0.4 percentage point in the Bank’s next outlook.
EBRD economies with high energy, fertiliser and food import dependence, strong links to the Gulf and limited fiscal space are likely to be most affected. These include Egypt, Iraq, Jordan, Kenya, Lebanon, Moldova, Mongolia, North Macedonia, Senegal, Tunisia, Türkiye and Ukraine, according to the report.
comments
EBRD: Jordan among countries most affected by rising energy prices
comments