Photo: Discoveryalert
Namibia could face rising fuel and living costs if a potential disruption in global oil supply routes drives prices higher, according to international market analysis.
The warning follows concerns over a possible blockade of the Strait of Hormuz, a key global energy corridor through which an estimated 17 to 20 million barrels of oil pass daily, along with a significant share of liquefied natural gas supplies. In commentary released on 13 April 2025, Nigel Green, chief executive of the deVere Group, warned that any sustained disruption could trigger a sharp increase in oil prices, potentially pushing Brent crude to around USD120 per barrel or higher.
According to the analysis, such a supply shock would force a rapid repricing across global markets, with higher energy costs feeding into transport, food and industrial prices. While the report does not refer specifically to Namibia, the potential implications for fuel-importing countries are clear. Namibia relies on imported fuel, meaning increases in global oil prices would likely translate into higher local fuel costs. Higher fuel prices typically have a knock-on effect across the economy, raising transport and logistics costs and contributing to increases in the price of goods and services. This, in turn, may place upward pressure on inflation and reduce consumer spending power.
Sectors heavily dependent on fuel, including aviation, shipping and manufacturing, could also face increased operating costs. Trade and transport activity through key hubs such as Walvis Bay may be affected by rising costs. The analysis further indicates that higher oil prices could influence global inflation trends and delay anticipated interest rate cuts, potentially keeping borrowing costs elevated. At the same time, higher global oil prices may increase investor interest in emerging oil-producing regions. This could have longer-term implications for Namibia’s offshore oil sector, where exploration activities are on-going, including projects led by companies such as TotalEnergies.
The situation remains hypothetical, but the analysis highlights the extent to which global energy developments can have local eco-nomic consequences, particularly for countries dependent on fuel imports.
By Eileen van der Schyff
Source: deVere Group
