Middle East war: global economic fallout

PARIS: Here are the latest economic events in the Middle East war:

- China fuel surcharges -

Several Chinese airlines, including national carrier Air China, said they will raise their fuel surcharges on domestic flights from Sunday.

Air China, China Southern and its subsidiary Xiamen Airlines said in statements that they will increase surcharges on flights of up to 800 kilometres (500 miles) by 60 yuan ($8.70), and 120 yuan for longer flights.

Spring Airlines and Juneyao Airlines also announced fuel surcharge hikes.

- Oil spikes -

Oil prices spiked after Trump reiterated that US forces would hammer Iran for another two to three weeks but offered no solution to the closure of the Strait of Hormuz that has crippled global markets.

Brent crude, which had fallen back below $100 a barrel on Wednesday, surged almost 7% to hit $108.15, while West Texas Intermediate jumped more than 5% to $105.65.

- Trump tells other countries to 'take care' of Hormuz -

US President Donald Trump called on Wednesday for countries that receive oil through the Strait of Hormuz to show "courage" and seize the key waterway.

"The countries of the world that... receive oil through the Hormuz Strait must take care of that passage," Trump said in his first prime-time address since the start of the war with Iran.

"Just take it, protect it, use it for yourselves."

- Malaysia work-from-home push -

Prime Minister Anwar Ibrahim said Malaysia will introduce a work-from-home policy for ministries, agencies, statutory bodies and government-linked companies starting April 15, to conserve energy while the Middle East war rages.

The policy "aims to reduce fuel consumption and ensure a stable energy supply", Anwar said during a special briefing late on Wednesday.

- UK meeting on Hormuz shipping -

Britain will hold a meeting of about 35 countries on Thursday to discuss how to reopen the Strait of Hormuz, Prime Minister Keir Starmer said.

The meeting will "assess all viable diplomatic and political measures that we can take to restore freedom of navigation, guarantee the safety of trapped ships and seafarers and resume the movement of vital commodities", Starmer said.

- World Bank 'extremely concerned' -

The World Bank is "extremely concerned" about the effect the war on Iran will have on inflation, jobs and food security, and is in talks with member states on how to address immediate needs in the crisis, a top official told AFP.

Managing Director Paschal Donohoe's comments came as his organisation announced a new partnership with the International Monetary Fund and International Energy Agency to coordinate aid responses to the war.

- Germany outlook dims -

Leading economic institutes cut their growth forecasts for Germany on Wednesday, warning that surging inflation resulting from the Middle East war and rising energy costs would hit Europe's biggest economy hard.

The German economy is expected to grow by 0.6% this year, the seven institutes said, down from a September forecast of 1.3%, while inflation is predicted to stand at 2.8%, up from 2.0%.

- Bank of England warning -

The Bank of England said the Middle East war had caused "a substantial negative supply shock to the global economy", increasing risks to the financial system.

Following a surge in oil prices that is set to push up overall inflation, the BoE said the fallout would also weigh on economic growth and tighten financial conditions, such as restricted lending by banks.

- India fuel hike -

India's oil ministry said that domestic jet fuel prices would rise as the Middle East war pushed up energy costs, but that it had cushioned airlines from an expected 100% jump.

- Kuwait airport hit -

Kuwait's international airport came under an Iranian drone attack that led to "a large fire" at fuel tanks, but no casualties were reported, the civil aviation authority said.

In a further sign of strain in the Gulf state, the National Bank of Kuwait said it would close its headquarters for two days along with another branch as Iran carries out daily strikes on the Gulf.

- Save fuel, Australians -

Australian Prime Minister Anthony Albanese urged his countrymen to switch to public transport and save fuel for rural communities and essential services.

"Farmers and truckies, small businesses and families are doing it tough. And the reality is, the economic shocks caused by this war will be with us for months," Albanese said in a national address.

By RSS/AFP