World on Brink of Oil Price Explosion Due to Middle East Conflict

The war in the Middle East could further increase oil prices, leading to serious economic consequences worldwide — and Hungary will not be spared either. In an interview with Magyar Nemzet, Oliver Hortay, head of the Energy and Climate Policy Division at Szazadveg, warned that if the conflict affects oil supply, prices could easily soar above $100, and rising energy costs could ripple through the Hungarian economy as well.

Photo: Peter Sipeki

EU energy markets are deeply interconnected, so rising prices will inevitably affect Hungary too,

 he explained.

Inflationary Effects and Energy Dependence

Rising oil prices directly affect fuel prices, but the indirect effects are also significant. As transportation costs rise, the price of virtually all products increases — and over the medium and long term, this can fuel inflation.

Oliver Hortay emphasized that 

the energy crisis has shown that energy carriers — especially oil — play a key role in the development of inflation. Both the EU and Hungary are energy importers, so rising global prices exert a direct negative impact.

This is the Strait of Hormuz, one of the world's most important oil chokepoints. pic.twitter.com/Gc7fZrXj6Y

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It All Depends on the Outcome of the War

Ultimately, the duration and severity of the market impact will depend on how quickly and in what way the conflict reaches a new, more stable point. "If the parties reach an agreement and the energy infrastructure remains intact, then market reactions will be temporary. But if the fighting drags on and the oil market becomes a direct target, we must prepare for lasting consequences," summarized Oliver Hortay.

Cover photo: Illustration (Source: Peter Sipeki)