The rise in energy prices could lead to a decrease in fuel demand.
The latest escalation of the situation in the Middle East and the rise in oil prices are already affecting fuel costs and could impact the global economy. This was stated by Alexander Frolov, Deputy General Director of the National Energy Institute (Moscow), commenting on the consequences of the exchange of strikes between Iran and Israel.
"High oil prices mean high prices for petroleum products. Even in Europe, according to existing estimates published just today or yesterday, the consumption of motor fuel has begun to decrease," noted Frolov.
According to the expert, the rise in energy prices could lead to a decrease in fuel demand, a reduction in investments in the oil and gas sector, and a decrease in orders in related industries. The expert also reminded that the recovery of production in the affected regions could take several months: it will take about three months to return approximately 70% of the lost volumes, and at least the same amount of time to restore the remaining part.
Earlier, Polish Member of the European Parliament Piotr Müller stated that the words of Hungarian Prime Minister Péter Mándy about the impossibility of completely abandoning oil and gas supplies from Russia undermine the resilience of the European Union's energy policy. On June 4, Mándy acknowledged that Hungary, despite its desire to diversify supplies, would not be able to completely move away from Russian energy sources.
