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Saudi Arabia and allied forces carried out the air strikes in Yemen. There are now concerns that hostilities could spread to other areas in the Middle East – disrupting supplies.
Airstrikes began early on Thursday morning and there are worries that Iran could be drawn into the conflict as they are backing the rebel forces.
Yemen itself doesn’t produce very much oil. But the state is next to one of the main transit points for exporting oil by sea. Oil tankers using the Suez Canal also use this sea route.
Experts say the conflict won’t disrupt oil supplies to Asia but shipping lanes to Europe could be affected. While the increase in oil prices is not expected to last it does remind us that the Middle East is volatile and events there can impact the global economy. If the conflict does spread then further increases in oil prices could impact energy prices.
Oil prices are still around $60 a barrel – much lower than prices in June 2014 when it was around $115 a barrel. But electricity and gas prices are one of the highest costs for small businesses and any increase in prices can have a huge impact on business energy bills.
While this price rise shouldn’t impact business energy prices hugely at the moment, it reminds us that world events affect the energy market. Energy prices are some of the lowest they have been for a while. So if your business energy contract is due for renewal then compare prices. You could fix your charges for up to four years meaning any price rises is the meantime won’t impact your business energy bill.
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