Some presidents, prime ministers, and other state leaders are sensitive to the immediate needs of their people. In times like these, when turmoil in the Gulf region has increased oil prices and caused inflation, they have found ways to ease their people’s economic stress.
See what some countries have done.
Ireland
Ireland has reduced fuel taxes to control the rise in petrol, diesel, and oil prices. For example, suspending the NORA levy has curbed the cost of home heating. NORA stands for National Oil Reserves Agency.
The country has also reduced VAT and excise duty on green diesel (energy from biomass). It has also extended the duration for social welfare heating payments for an extra four weeks. This means that the payments the government normally makes from September to May should now reach June.
Vietnam
To mitigate the cost of living, Vietnam has rescinded fuel taxes. This includes one that normally goes to environmental protection. Diesel and petrol also remain free from Value Added Tax (VAT).
Australia
Some states in Australia are facilitating free travel. Essentially, they have allowed people to travel for free by public transport to encourage them to leave their cars at home. This is one way of reducing the demand for scarce fuel and somewhat keeping fuel prices in check.
For example, in Tasmania, ferries, buses, and coaches are carrying passengers free of charge during April, a plan expected to continue through June.
The minister in charge extended the same relief to school buses that charge students transport fees. Hence, parents will be able to save 20 Australian dollars every week.
Victoria and Queensland are also subsidizing public transport and, in some cases, extending the offer to school transport.
UK
In the UK, the government has communicated with fuel distributors, who have agreed not to take undue advantage of the oil crisis. The UK’s Petrol Retailers Association has promised to remain reasonable and not profiteer from the unfortunate situation.
In the meantime, Prime Minister Keir Starmer committed the government to paying out a £53 million package to households that rely on heating oil and are in the low-income bracket. He also promised to intervene if fuel operators choose to profiteer from the Gulf war situation.
Spain
Spain has temporarily halted rent increases. Usually, when a rental contract expires, a new one comes with a rent increase. The government has instructed big landlords to extend tenants’ existing rental contracts and not to raise rents by more than 2% this year.
In so doing, the country is mitigating the effects of inflation caused by rising energy prices and, consequently, by higher consumer prices.
China
China has always been prudent in buying extra oil whenever global oil prices are low, so the country has plenty of reserves to last around three more months.
Still, the government has stopped the country’s refineries from exporting any fuel forthwith, to ensure the domestic fuel prices remain stable. Better still, Iran has continued to allow China’s oil ships to pass through the Strait of Hormuz safely.
India
India also engages in some stockpiling in preparation for eventualities such as the current war situation. At the end of March, the oil ministry informed the country that there is no need for panic buying of fuel, as the country has sufficient crude oil to last 60 more days.
In the meantime, the government has been engaging with Iran diplomatically and transporting oil through the Strait of Hormuz without issue. Eight loaded Indian oil ships passed through the waterway this week, and 16 more are expected to follow.
Egypt
The Egyptian government has engaged with employers and agreed to allow employees to work from home unless it is necessary for them to be at their official workplaces. This arrangement is meant to reduce the level of commuting, hence reduce the demand for fuel.
Philippines
In the Philippines, the government has reduced the workweek for government employees by a day to lower fuel demand from commuters.
The government is also giving subsidies to operators of Public Utility Vehicles (PUV). Some of the subsidies are in cash, while others are in the form of fuel subsidies. The government has taken these measures after declaring a national emergency.
So, as governments continue to shield their citizens from escalating oil prices, many are still maintaining diplomatic communication with Iran to ensure continued supplies.
Hence, countries such as China, Russia, India, Malaysia, Sri Lanka, Bangladesh, Thailand, France, and Pakistan have been able to buy their oil from the source and transport it through the Strait of Hormuz.
There are a few countries that Iran has granted an express pass through the Strait of Hormuz, including Russia, China, and India. Others have to be screened a bit in case they are being used as proxies for Iran’s enemies.