The European Commission has announced that the union is engaged in negotiations with various suppliers in the event of a disruption in the supply of Russian energy. The commission notes that enough energy has been provided to last until the end of the heating season. In particular, the delivery of liquefied gas was increased, setting a new record high in January.
On Monday government decided to reduce excise taxes on fuels for a period of 90 days, and to limit margins for retail sellers of gasoline, diesel and red-diesel, in a bid to mitigate the impact of announced price hikes tomorrow.
Meanwhile, European stock exchanges sank this morning after news that the US and European allies were considering a ban on Russian oil imports. However, the news prompted oil prices to rise to their highest level in 13 years, with a barrel reached 130 US Dollars on the London market this morning, and 124 dollars in the US. Economists have warned that the loss of Russia's 5 million barrels of oil exported per day could cause the price of a barrel to jump to 200 dollars and reduce the growth of the global economy, prompting them to call on governments around the world to provide assistance to poorer households with high living costs.
The effects of spiraling fuel prices has spilled over into global food prices. According to the United Nation Food and Agriculture Organization (FAO), world food prices rose more than 24% in February on an annual basis, reaching the highest level since the United Nations Food Agency has been monitoring this data point. The price of vegetable oils has risen the most, and there are fears of disruptions in the export of sunflower seed oil from the Black Sea region, which together with Russia makes up about 80 percent of the global export market. Due to fears of supply disruptions from Ukraine and Russia, wheat prices have risen sharply today, the most in 14 years. Traders are warning that some European countries could restrict exports, noting that Hungary has already banned the export of all cereals. Russia and Ukraine together account for about 29 percent of world wheat exports and 19 percent of corn exports.
Meanwhile, the European Farmers' Association has asked the European Union to protect it from the possible consequences of two major crises - the war in Ukraine and climate change. The Union is being asked to do everything possible to ensure that all arable land be cultivated this year, thus compensating for the blockade of Russian and Ukrainian agricultural production.
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