Middle East conflict could push up cost of living in Fiji

Rising tensions in the Middle East are not just a distant crisis, they could soon hit Fijian households at the checkout counter. 

Experts warn that surging global oil prices may drive up the cost of living, affecting everything from transport to groceries. 

In an interview, Minister for Finance Esrom Immanuel said the Government is closely monitoring the situation as the conflict continues to push fuel prices higher. 

Oil has already jumped from around FJD $132.64 per barrel last year to about FJD $185.76 today, with fears of further increases if global supply is disrupted. 

“As a small island economy and a price taker in global markets, such increases would pose significant challenges for Fijian businesses, consumers and the broader economy,” Mr Immanuel said. 

He explained that higher fuel prices would increase transportation and production costs, eventually pushing up the price of goods and services nationwide. 

Mr Immanuel acknowledged that Fiji relies heavily on imports, including fuel, making the country vulnerable to global price shocks. 

“It will surely affect us because we import a lot of products, including fuel, which is a major component of what we need. But it’s not time to panic currently. 

He also stressed that Fiji has sufficient oil reserves for now, even as the Government continues major trade to secure fuel supplies. 

“We have oil stocks with us, and the effect of any marginal cost increase will be manageable,” he said. 

Consumer Council of Fiji chief executive officer, Seema Shandil, warned that the impact extends beyond Fiji. 

“Of course, there will be an impact, not only in Fiji, but to consumers across the world.” 

“That’s the impact of that business crisis. We will continue to monitor the situation and work with policymakers to see what policies can be brought in,” Ms Shandil. 

Mr Immanuel also warned that global instability could affect Fiji’s tourism sector, particularly the national airline Fiji Airways, as rising fuel costs and weaker global demand may slow travel activity. 

Despite the warnings, the government urged calm, noting that Fiji currently has adequate foreign exchange reserves to cushion the country against economic shocks. 

“Government will continue to explore ways to support consumers and businesses if the situation worsens," Mr Immanuel said.