Oil Price Hikes Hit Poor Countries The Hardest

By Vijay Jayaraj

The fighting in Ukraine has intensified and residents are fleeing cities with Russian forces showing no signs of retreating. What does this have to do with the lives of billions of people living far away from the war? Oil price increases.

The conflict has caused an increase in international oil prices, which have now crossed $130 per barrel, a 13-year high. As a result, gas prices at pumps across the globe are set to rise even further.

Being the largest consumers of automobile fuels, motorists in the U.S. and Europe are feeling significant economic pain. However, the situation is far more serious for populations of developing countries who have a much smaller buffer against life-threatening deprivation.

Take Nigeria for example, the largest economy in Africa ($514 billion USD). Neither the size of the economy nor the presence of crude reservoirs was sufficient to protect the country from the price shock. Nigerians already were grappling with a month-long fuel shortage due to quality-related import restrictions. While government subsidies soften the effect on users of gasoline, there is no such support for diesel.

Diesel is selling for Naira 625 per liter in Lagos and Abuja, 30 percent higher than two weeks ago. Diesel prices are expected to touch 650 soon and are disrupting everyday lives. Nigeria is infamous for its energy poverty, with only 40 percent of the 193-million population having access to electricity. The rising fuel costs will force many more millions into energy poverty.

In the neighboring West African country of Ghana, which is a net exporter of oil, fuel prices have risen dramatically in the first quarter and are affecting all kinds of businesses. For a country that is already in an ongoing economic crisis caused by debt distress, rising gasoline and diesel prices have become a nightmare.

Though Ghana exports high-quality crude, it has inadequate refinery capacity to convert domestic oil into finished petroleum products. Like Nigeria, it depends on imports of refined products. Currently, 80 percent of all finished petroleum products are imported. Inflation rates will be driven up by fuel prices that may increase by 6 percent, sending households into further chaos in what was originally supposed to be the fastest growing major economy in Africa.

In Asia, less-developed economies that were caught up with the decade-long green movement failed to invest in fossil-fuel technology and now face extraordinary import bills due to the rise in international crude prices.

Last month, Thailand’s inflation rose to its highest in 13 years at 5.28 percent. Speaking to Al Jazeera, the chairman of the Thai National Shippers Council said, “The geopolitical situation, global inflation, the pandemic – Thailand still has a high number of cases – and freight costs are still very high. All of that is certain to damage our growth.”

Neighboring Philippines is in murky waters as well, with gasoline prices set to rise by 11 Phillipine Pesos and eventually increase by a further 20 pesos by the end of March. A record high of 100 pesos per liter for gasoline will send small businesses and households into great distress.

In the abstract, the victims of higher energy prices are economic growth and the long-running fight against poverty, which translates into harder lives for billions of people struggling to fend off malnutrition and disease.

A simple solution would be to reverse anti-fossil fuel policies that cause shortages and to make the well-being of citizens the first priority.

Vijay Jayaraj is a Research Associate at the CO2 Coalition, Arlington, Va., and holds a Master’s degree in environmental sciences from the University of East Anglia, England. He resides in Bengaluru, India.

This commentary was first published by American Thinker March 13, 2022.

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March 14, 2022 6:37 pm

Expensive fuel to transport food is a problem. One which is, as is usual when the “smart” people are involved, will be solved – by there being no food to transport. I shudder to think of what will happen in countries that, thanks to corruption and “green” policies, import a major part of their people’s diets.

william Johnston
Reply to  writing observer
March 14, 2022 6:50 pm

And somewhere Paul Ehrlich is smiling.

another ian
Reply to  writing observer
March 15, 2022 1:34 am

And when everyone is importing where does it come from?

H.R.
Reply to  another ian
March 15, 2022 4:14 am

Russia?

(😜, I think. Maybe not.)

TonyL
March 14, 2022 6:51 pm

Oil Price Hikes Hit Poor Countries The Hardest

Also, in other news….

Food Price Hikes Hit Poor Countries The Hardest

I have no idea what the solution might be….
This looks like a job for— Captain Obvious!

Last edited 2 months ago by TonyL
Pillage Idiot
Reply to  TonyL
March 14, 2022 7:05 pm

Oil Price Hikes Leftist Policies Hit Poor Countries The Hardest

Food Price Hikes Leftist Policies Hit Poor Countries The Hardest

My word replacement bot can correctly diagnose almost every single problem facing humanity!

Derg
Reply to  Pillage Idiot
March 14, 2022 7:52 pm

Excellent work Replacement bot. Any chance you can get us new leaders?

Big Al
Reply to  Derg
March 14, 2022 9:53 pm

Leaders who do not worship Satan are taking control. Trump claimed virus came from ???. Ukraine city Chy-Na pronounced without hyphen sounds like ? Marked on Putin’s map indicating BIG HOLE where bio lab existed. Ok, guessing about hole.

griff
Reply to  Pillage Idiot
March 15, 2022 10:00 am

Because anyone not on the extreme right of the Republican party is a leftist…

I really think you ought to get out more

Frank from NoVA
Reply to  TonyL
March 14, 2022 7:06 pm

Yeah, really. Dog bites man…

Brad-DXT
March 14, 2022 10:36 pm

Poor people will die due to energy deprivation and malnutrition because of green energy scams and corruption.
This is a feature of the new world order, not a bug.

griff
Reply to  Brad-DXT
March 15, 2022 9:59 am

In Nigeria they die because of fossil fuel scams and corruption

Reply to  griff
March 15, 2022 11:18 am

What griff fails to mention, of course (charitably, it could simply be another example of his utter ignorance of anything but the current list of comments to troll), is the political makeup of the Nigerian government.

The dominant party, holding the Presidency and a plurality in the Legislature, is an outfit called the “All Progressives Congress.” You can tell what ideology they follow just from the name, yes? Their coalition is with the splinter parties that are even further toward Leftist dictatorship.

Gunga Din
Reply to  griff
March 15, 2022 3:07 pm

DANG!
I could saved millions if I’d only sent that Nigerian prince $43 bucks to free up his billions!!

another ian
March 15, 2022 1:32 am

I recall an item a while back that mentioned that the third world uses per year about as much kerosene for lighting, cooking and heating as the US does jet fuel.

Explained why you can still buy a Tilley light.

Fossil free will go over big time there (/s if needed)

griff
Reply to  another ian
March 15, 2022 9:59 am

Yes and I’ve pointed out that that is a major cause of fuel poverty and that there’s an alternative in the form of solar LED lanterns, which are sold cheaply and then require no monthly kerosene expenditure.

How Solar Lanterns are Transforming the African Continent | by Power Africa | Power Africa | Medium

You can contribute to this advance here:
SolarAid | Combatting poverty and climate change (solar-aid.org)

Michael in Dublin
March 15, 2022 4:56 am

Simple solution: the US/EU are responsible because of their actions/inaction relating to fossil fuels therefore they should fork out billions to poor countries in Africa and elsewhere. The problem is that it is not the citizens of these Western countries that took the decision but politicians, influenced by certain business people and activists. They should be named and shamed for the harm they have caused by their policies/ideologies.

Last edited 2 months ago by Michael in Dublin
Tom Abbott
March 15, 2022 6:12 am

Higher fossil fuel prices harm the poor in every country.

Biden needs to push the fossil fuel industry to produce as much fossil fuels as possible. This will ultimately lower the price of gasoline and lower the price of everything else as a result.

Of course, Biden will never do this. He will do just the opposite: Continue to try to cripple the fossil fuel industry, erroneously believing that CO2 reduction is a higher priority than the economy.

CO2 reduction is unnecessary as there is no evidence CO2 is anything other than a benign gas essential for life on Earth. Biden’s insistence on CO2 reduction is not based on science. Biden is a zealot on a mission, and we are all going to suffer if he is successful.

I don’t think he is going to be successful in the long run, but I think he is going to do considerable harm in the process.

The man is a disaster. And he actually thinks he has it all figured out. That just goes to show how delusional he is.

griff
Reply to  Tom Abbott
March 15, 2022 9:56 am

CO2 reduction is unnecessary as there is no evidence CO2 is anything other than a benign gas essential for life on Earth. 

There is realms of evidence, physical evidence, not models… vast amounts of scientific evidence.

You can’t just keep repeating fake news like that…

richard
Reply to  griff
March 15, 2022 10:33 am

“The IPCC concept that increasing carbon dioxide in the atmosphere causes global warming is three decades out-of-date.” − Lightfoot and Ratzer (2022), Journal of Basic & Applied Sciences

https://notrickszone.com/2022/03/14/new-study-the-co2-drives-global-warming-concept-is-obsolete-and-incorrect/

Gunga Din
Reply to  griff
March 15, 2022 3:13 pm

Sure, griff, sure. All the evidence is in one tree ring.

Reply to  Tom Abbott
March 15, 2022 11:19 am

No – no “pushing.” Just get the hell out of the way!

Tom Abbott
Reply to  writing observer
March 15, 2022 7:46 pm

Ideally, yes.

David Elstrom
March 15, 2022 7:16 am

So what? The principle objection to Woke governments’ war on oil, gas, and coal is they work against the interests of their own citizens—not just unrepresentative but the antithesis of protecting life, liberty, and the pursuit of happiness.

Andy Pattullo
March 15, 2022 7:42 am

Hard not to give in to the impression that enviro-wingnuts, “progressive” left politicians, autocratic rulers and the purposeless rabble of the elite educated class are actually glad for every crisis that further impoverishes the less developed nations. Some of the ecoloons are foolish enough to even speak their thoughts in public – that they feel the world will be a better place with less people no matter how that is achieved. Putin is clearly on board.

griff
Reply to  Andy Pattullo
March 15, 2022 9:55 am

I find it strange that after 75 post WW2 years of fossil fuels, they still haven’t made these impoverished nations wealthy…

griff
March 15, 2022 9:54 am

A simple solution would be to reverse anti-fossil fuel policies that cause shortages

And how are there anti fossil fuel policies in oil producers like Nigeria and Ghana?

Crisp
March 17, 2022 3:30 am

Nigeria could be a rich country if not for its insane population growth that gobbles up any economic growth.
Africa could be a rich continent if not for the same reasons.
Ditto South Asia and SE Asia.
They know the cause. They know the cure. It’s their choice. They’re adults after all.

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