US-Iran war effect: How governments worldwide are tackling fuel crisis
What's the story
The ongoing conflict between the United States, Israel, and Iran has sent shockwaves through global energy markets. Crude prices have skyrocketed and supply chains have been disrupted, especially through the crucial Strait of Hormuz. In response to this unprecedented fuel crisis, governments across Asia, Europe, and Africa are taking emergency measures such as tax cuts and subsidies.
Energy stabilization
India cuts duties, diverts gas supplies
India has taken several steps to mitigate the impact of the fuel crisis. The government has cut excise duties on petrol and diesel and imposed windfall taxes on fuel exports. India is also diverting gas supplies to priority sectors and asking refiners to increase LPG production. This comes as neighboring countries such as Sri Lanka, Bangladesh, and Maldives seek fuel assistance from India.
Emergency measures
Sri Lanka and Pakistan's emergency measures
Sri Lanka, still recovering from its 2022 financial crisis, is facing severe fuel shortages. The government has approved emergency purchases outside regular tenders and introduced fuel rationing. Authorities have also declared a weekly public holiday to conserve energy and raised power tariffs. Meanwhile, Pakistan has imposed aggressive conservation measures such as shutting shopping malls by 8:00pm and reducing government department fuel allowances.
Tax reliefs
South Africa opts for short-term tax relief
South Africa has opted for short-term tax relief by cutting its fuel levy by three rand per liter for one month. This move comes amid record fuel price hikes, with diesel prices surging sharply. However, the country is facing panic buying and rationing at petrol stations due to fuel shortages. Australia has halved its fuel excise duty for three months and rolled out a national fuel security plan urging citizens to limit consumption voluntarily.
Demand reduction
China raises retail fuel prices amid conservation push
China has raised retail petrol and diesel prices by CNY 420 and CNY 400 per metric ton respectively. The National Development and Reform Commission said the move is aimed at reflecting rising international oil prices, while continuing measures to control volatility in the domestic market. In Southeast Asia, countries like Thailand and Vietnam are focusing on demand reduction by encouraging remote work and carpooling.
Targeted support
EU focuses on renewable energy push
The United Kingdom has avoided sweeping interventions, instead focusing on targeted financial support for vulnerable households. The European Union is combining short-term relief measures with a long-term push toward renewable energy. Some countries are even reconsidering coal usage to ensure energy security.