oil prices could derail economy, Treasury warns
The Australian Treasury has warned that rising oil prices, driven by geopolitical tensions in the Middle East and Russia, could lead to increased inflation and slower economic growth. Retail fuel prices have already begun to climb, prompting concerns about the long-term stability of the domestic economy.
Why it matters
Rising energy costs act as a significant headwind for global economic recovery and can trigger cost-of-living crises for consumers.
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Share A A A Treasury has warned the Australian economy could be hit by an inflation spike and slower growth through the second half of the year as America’s war against Iran , Houthi attacks in the Red Sea, and Ukraine’s assault on Russian oil refineries upend the global petroleum market.
Amid forecasts from the chief economist of the nation’s biggest bank that the “clock was ticking” on oil spiking towards $US150 a barrel, Treasury is increasingly worried of a price crunch as nations run down their oil reserves, and supplies out of the Middle East and Russia dry up.
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