In Africa, where trucks dominate the flow of products, farmers rely on fuel-powered gear, and many companies rely on diesel generators, a dramatic spike in diesel costs may swiftly spread across the economy.
This makes pricey diesel more than a transportation issue. It has the potential to raise food prices, squeeze companies, reduce industrial competitiveness, boost the cost of infrastructure projects, and put more strain on household incomes.
The hazards are increasingly clear as the global diesel market tightens.
In July, diesel shipments from Russia, the Middle East, and Asia declined by over 1.3 million barrels per day year on year, accounting for nearly 20% of global seaborne diesel commerce, according to data cited by Axios.
For African countries that rely largely on imported refined fuels, another extended period of high diesel costs might be especially painful.
