Rising gas prices threaten stability and livelihoods around the world

The cost of filling a car's tank, getting to work and cooking dinner has spiked

“No es suficiente” — It’s not enough. That was the message protest leaders in Ecuador delivered to the country’s president this past week after he said he would lower the price of both regular gas and diesel by 10 cents in response to riotous demonstrations over soaring fuel and food prices.

The fury and fear over energy prices that have exploded in Ecuador are playing out the world over. In the United States, average gasoline prices, which have jumped to $5 per gallon, are burdening consumers and forcing an excruciating political calculus on President Joe Biden before the midterm congressional elections this fall. But in many places, the leap in fuel costs has been much more dramatic, and the ensuing misery much more acute.

Families worry how to keep the lights on, fill the car’s gas tank, heat their homes and cook their food. Businesses grapple with rising transit and operating costs and with demands for wage increases from their workers.

In Nigeria, stylists use the light of their cellphones to cut hair because they can’t find affordable fuel for the gasoline-powered generator. In Britain, it costs $125 to fill the tank of an average family-size car. Hungary is prohibiting motorists from buying more than 50 liters of gas a day at most service stations. On Tuesday, police in Ghana fired tear gas and rubber bullets at demonstrators protesting against the economic hardship caused by gas price increases, inflation and a new tax on electronic payments.

The staggering increase in the price of fuel has the potential to rewire economic, political and social relations around the world. High energy costs have a cascading effect, feeding inflation, compelling central banks to raise interest rates, crimping economic growth and hampering efforts to combat ruinous climate change.

The invasion of Ukraine by Russia, the largest exporter of oil and gas to global markets, and the retaliatory sanctions that followed have caused gas and oil prices to gallop with an astounding ferocity. The unfolding calamity comes on top of two years of upheaval caused by the Covid-19 pandemic, off-and-on shutdowns and supply chain snarls.

The spike in energy prices was a major reason the World Bank revised its economic forecast last month, estimating that global growth will slow even more than expected, to 2.9% this year, roughly half of what it was in 2021. The bank’s president, David Malpass, warned that “for many countries, recession will be hard to avoid.”

In Europe, an overdependence on Russian oil and natural gas has made the continent particularly vulnerable to high prices and shortages. In recent weeks, Russia has been ratcheting down gas deliveries to several European countries.

Across the continent, countries are preparing blueprints for emergency rationing that involve caps on sales, reduced speed limits and lowered thermostats.

Left with less than a day’s fuel: Lanka
 

Sri Lanka has less than a day's worth of fuel left, the energy minister said on Sunday, with public transport grinding to a halt as the country's economic crisis deepened. 

Petrol and diesel queues snaked through the capital for kilometres, though most pumping stations have been without fuel for days. Energy minister Kanchana Wijesekera said petrol reserves in the country were about 4,000 tonnes, just below one day's worth of consumption.