By Tellah Hazinji
Economist Richard Mbewe says Russia’s temporary ban on fuel exports will make inflation in countries like Zambia unbearable.
On Thursday this week, Russia banned the export of fuel to balance the domestic market which saw Brent crude oil climbing 1.9 percent to $94.50 a barrel.
Dr. Mbewe says this escalation will raise fears as Russia is a net exporter which produces more than it consumes and will lead to a surplus on the domestic market but will exert more pressure on market participants like Zambia who are already grappling with heightened fuel prices.
He has told Phoenix News that it is unfortunate that Russia is moving to tighten oil supply at a time when central banks are struggling to get inflation under control.
Dr. Mbewe says countries like Zambia will be forced to start fighting inflation which will mean tightening monetary policies and increasing interest rates, a situation he says will further reduce money in circulation.