News / Asia

Economists Warn Higher Oil Prices Will Worsen Asia's Food Inflation

Central Illinois farmer Bob Hogan climbs back into his combine while harvesting soybeans in Pawnee, Illinois, October 7, 2010 (file photo)
Central Illinois farmer Bob Hogan climbs back into his combine while harvesting soybeans in Pawnee, Illinois, October 7, 2010 (file photo)
Ron Corben

Global oil prices have spiked in recent days in response to political instability in the Middle East and North Africa. 

Asia's export-driven economies, dependent on imported oil, are bracing for higher inflation as global oil price tops $100 a barrel.

Aynul Hasan, a senior economist at the United Nations Economic and Social Commission Asia Pacific, says oil prices now depend on how the political turmoil unfolds in the Middle East.

"High oil prices very much depend on how soon things will settle down," Hasan explained.  "Obviously in this uncertainty there will be short-term disruption. Many countries have the buffer stock which can carry on for a few weeks. But if this carries on for longer, then definitely this will have an impact. Let's hope that this is not the case."

Hasan says oil costs could accelerate the rise in food prices, caused by poor crops in some areas and rising demand in many countries.

The World Bank has warned that food prices are dangerously high and seem set to continue rising. The higher prices already are affecting millions of Asia's poor. World Bank and UNESCAP economists predict more people will fall into poverty due to higher food costs in the coming year.

Supavud Saicheua, an economist with Thai stock brokering house Phatra Securities, says Asia's economic growth - largely dependent on exports - is vulnerable to sharp increases in oil prices.

"If you argue that the high oil price is primarily supply shock because of concern about Libya and other oil producing countries unable to produce, then that's very bad because if you have global slowdown and high oil prices then, it will hit Thailand and the rest of the region very hard," said Saicheua.

Most Asian countries are net importers of oil, including the manufacturing powerhouse China.

In July 2007, the aviation industry was hard hit when oil prices reached a record $147 a barrel. Then the global economic slump in 2008 led to sharp declines in passenger traffic and more losses for the industry. Airline shares have fallen in recent days as investors feared aviation profits may soon drop again.

Supavud says the oil commodity futures market expects at least six months of uncertainty before the market returns to normal.

World oil demand amounts to around 90 million barrels a day.  Libya contributes about one million barrels.

Higher food prices and poor economic conditions have contributed the discontent of many of the protesters across the Middle East. In East Asia, many governments are on the watch for inflation and have taken steps such as raising interest rates and curtailing capital inflows to tamp it down.

You May Like

Mugabe Dismisses Male-Female Equality

'It is not possible that women can be at par with men' incoming African Union president declares on eve of summit More

Somali Terror Suspect's Light Sentence Raises Questions

Abdullahi Yusuf, 18, could have spent 15 years in prison but judge instead sentenced him to a halfway house, and a program to try to integrate him back into the community More

Video Kobani Ravaged Following Kurdish Ouster of IS Militants

Even so, hundreds of refugees sheltering in Turkey seek to return; Kurdish forces hold some back, saying fighting continues More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Groundbreaking Hand-Painted Documentary About Van Gogh in Productioni
X
George Putic
January 29, 2015 9:43 PM
The troubled life of the famous 19th century Dutch painter Vincent van Gogh has been told through many books and films, but never in the way a group of filmmakers now intends to do. "Loving Vincent " will be the first ever feature-length film made of animated hand-painted images, done in the style of the late artist. VOA’s George Putic reports.
Video

Video Groundbreaking Hand-Painted Documentary About Van Gogh in Production

The troubled life of the famous 19th century Dutch painter Vincent van Gogh has been told through many books and films, but never in the way a group of filmmakers now intends to do. "Loving Vincent " will be the first ever feature-length film made of animated hand-painted images, done in the style of the late artist. VOA’s George Putic reports.
Video

Video Rock-Consuming Organisms Alter Views of Life Processes

Scientists thought they knew much about how life works, until a discovery more than two decades ago challenged conventional beliefs. Scientists found that there are organisms that breathe rocks. And it is only recently that the scientific community is accepting that there are organisms that could get energy out of rocks. Correspondent Elizabeth Lee reports.
Video

Video Paris Attacks Highlight Global Weapons Black Market

As law enforcement officials piece together how the Paris and Belgian terror cells carried out their recent attacks, questions are being asked about how they obtained military grade assault weapons - which are illegal in the European Union. As VOA's Jeff Swicord reports, experts say there is a very active worldwide black market for these weapons, and criminals and terrorists are buying.
Video

Video Activists Accuse China of Targeting Religious Freedom

The U.S.-based Chinese religious rights group ChinaAid says 2014 was the worst year for religious freedom in China since the end of the Cultural Revolution. As Ye Fan reports, activists say Beijing has been tightening religious controls ever since Chinese leader Xi Jinping came to office. Hu Wei narrates.
Video

Video Super Bowl Ads Compete for Eyes on TV, Web

Super Bowl Sunday (Feb. 1) is about more than just the NFL's American football championship and big parties to watch the game. Viewers also tune in for the world famous commercials that send Facebook and Twitter abuzz. Daniela Schrier reports on the social media rewards for America’s priciest advertising.
Video

Video Theologians Cast Doubt on Morality of Drone Strikes

In 2006, stirred by photos of U.S. soldiers mistreating Iraqi prisoners, a group of American faith leaders and academics launched the National Religious Campaign Against Torture. It played an important role in getting Congress to investigate, and the president to ban, torture. VOA's Jerome Socolovsky reports.
Video

Video Freedom on Decline Worldwide, Report Says

The state of global freedom declined for the ninth consecutive year in 2014, according to global watchdog Freedom House's annual report released Wednesday. VOA's William Gallo has more.
Video

Video MRI Seems to Help Diagnose Prostate Cancer, Preliminary Study Shows

Just as with mammography used to detect breast cancer, there's a lot of controversy about tests used to diagnose prostate cancer. Fortunately, a new study shows doctors may now have a more reliable way to diagnose prostate cancer for high risk patients. More from VOA's Carol Pearson.
Video

Video Smartphones About to Make Leap, Carry Basic Senses

Long-distance communication contains mostly sounds and pictures - for now. But scientists in Britain say they are close to creating additions for our smartphones that will make it possible to send taste, smell and even a basic touch. VOA’s George Putic reports.
Video

Video Former Sudan 'Lost Boy' Becomes Chess Master in NYC

In the mid-1980’s, thousands of Sudanese boys escaped the country's civil war by walking for weeks, then months and finally for more than a year, up to 1,500 kilometers across three countries. The so-called Lost Boys of the Sudan had little time for games. But one of them later mastered the game of chess, and now teaches it to children in the New York area. VOA’s Bernard Shusman in New York has his story.
Video

Video NASA Monitors Earth’s Vital Signs From Space

The U.S. space agency, NASA, is wrapping up its busiest 12-month period in more than a decade, with three missions launched in 2014 and two this month, one in early January and the fifth scheduled for January 29. As VOA’s Rosanne Skirble reports, the instruments being lifted into orbit are focused on Earth’s vital life support systems and how they are responding to a warmer planet.
Video

Video Crowded Republican Presidential Field Off to Early Start for 2016

It seems early, but the 2016 U.S. presidential election campaign is already heating up. Though no one has officially announced a candidacy, several potential Republican contenders have been busy speaking to conservative groups about making a White House run next year. Many of the possible contenders are critical of the Obama administration’s foreign policy record. VOA national correspondent Jim Malone reports.

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More

All About America

AppleAndroid