Global prices of commodities and fuel have soared to unprecedented levels as Russia’s invasion of Ukraine enters its third week on Thursday, 17 March. Ukraine has halted exports of raw materials while several countries have imposed sanctions on Russia, including the United States (US).
But, how is the war impacting your pocket? Which items will get costlier? Here's all you need to know.
Which commodities will become expensive?
Both Russia and Ukraine are among the biggest exporters of edible oils. Seventy percent of India's sunflower oil exports are from Ukraine.
The rise in prices of food oils will affect the prices of FMCG (fast-moving consumer goods) products in global markets.
Both the countries account for 29 percent export of the grain in global market, with Ukraine popularly known as the ‘breadbasket of Europe.'
The war has halted all exports and prices are expected to rise multifold as the war continues. Russian troops have bombed fields, machinery, and equipment in Ukraine and the supply shortage may take a while to recover.
Ukraine is also one of the biggest exporters of corn across the world. Exports via ports, land routes, and air freight have reached a screeching halt and has, therefore, impacted shipments. Consequently, the price of the golden cereal has shot up dramatically and threatens the food security of millions.
Will the war impact the prices of metals?
Russia is one of the biggest exporters of rare metals such as nickel, platinum, palladium, and gold.
Severe sanctions on Russia have stopped the metals from reaching the global market, toppling prices and raising fears over metal shortage.
The prices of nickel have shot up to $100,000 a tonne on the London Metal Exchange. The prices of steel are also expected to shoot up as the war wages on.
Will crude oil prices slip out of hand?
Crude oil prices are hovering at over $100-mark currently, and further escalation will lead to a rise in prices of petroleum and petrochemical products.
The surge in prices is bound to hurt India, which is the world’s third-largest oil consumer, behind US and China.
Will travel be expensive?
India imports over 40 percent of its oil needs. With the rise in crude prices, it will also lead to an increase in petrol and diesel prices in India. Air fares are also expected to be affected around the world.
The pandemic had grounded all flights and had dented the airline industry globally. As the COVID-19 restrictions eased up, the industry was optimistic of a slow recovery.
However, the war and its consequent impact on crude oil prices will eventually transfer to the passengers, making air fares expensive.