Inflation is once again threatening through fuel and logistics
Geopolitical upheavals have once again brought back to the table a question that a large part of Europe had been trying to leave behind in recent months: can inflation return through energy and transport even at a moment when price pressures seemed to be easing. At the centre of attention are no longer only interest rates and domestic demand, but also energy flows, maritime routes and the cost of moving goods from the producer to the shelf. Analysts are therefore watching ever more carefully every signal coming from the wider Middle East area, from tanker movements and insurance premiums to the behaviour of oil traders and the expectations of carriers. When such disruptions spill over into the fuel market, the effect does not stop at petrol stations. Higher fuel prices very quickly hit road haulage, air transport, imported goods, the food chain and ultimately household budgets, so a geopolitical shock can in the short term turn into a new inflationary wave.
The beginning of March 2026 showed how alive that link still is. Nervousness rose again on the energy markets, and the price of Brent crude briefly climbed above the level of 90 dollars per barrel, with strong daily and weekly fluctuations. Such movements in themselves do not mean that inflation will automatically return to the levels of 2022, but they are a reminder that the period of relative calm can reverse much faster than central banks and governments would wish. The energy market reacts in advance, before the disruption is fully materialised in physical delivery. A rise in risk for passage through key maritime chokepoints, more expensive insurance and higher transport costs is enough to change the entire chain of price formation.
Oil, ships and insurance as the first transmission channel
For Europe’s economy, it is particularly important that energy and logistics are interconnected more than it may seem at first glance. If the price of crude oil rises, petrol, diesel and jet fuel become more expensive. If at the same time the security situation on important sea routes deteriorates, ships change course, voyages take longer, more fuel is consumed, and carriers and insurers raise prices. This simultaneously opens two inflation channels: one through energy products and the other through more expensive delivery of goods. That is precisely why economists warn that geopolitical shocks from regions important for energy and maritime trade almost never remain only a security issue. They very quickly become a matter of prices, margins and monetary policy.
UN Trade and Development, namely UNCTAD, warned in its review of maritime transport for 2025 that disruptions to shipping in the Red Sea are continuing and that levels of ship tonnage through the Suez Canal in early May 2025 remained around 70 percent below the average from 2023. The same institution states that the Strait of Hormuz accounts for around 11 percent of global maritime trade and more than one third of maritime oil exports. In other words, these are points at which geopolitical risk is translated into market cost almost instantly. Even when the physical flow is not completely interrupted, the mere possibility of delays is enough for carriers to change routes, while financial markets build an additional risk premium into the price of energy products and transport.
Such a mechanism is already well known from previous crises. When ships are redirected around the Cape of Good Hope instead of taking the shorter route through the Suez Canal, the journey takes longer, the fleet is less available, and the cost per container rises. On the face of it, this is a logistical technicality, but for the producer, importer and trader it means more expensive goods and weaker predictability of deadlines. Companies then have to choose between two bad solutions: accept a lower margin or pass the price increase on to the buyer. In conditions where many companies have already exhausted the room for cushioning higher costs, the pass-through to the final price becomes more likely than it was a year ago.
Why airline tickets and consumer goods are especially sensitive
One of the first sectors to react to more expensive energy products is air transport. The International Air Transport Association, IATA, announced that the global average price of jet fuel rose by 3.6 percent in the last week, to 99.40 dollars per barrel. This does not mean that every airline ticket will automatically become more expensive overnight, because some companies use risk protection through hedging, while others try to absorb part of the change through capacity management. Still, fuel is among the biggest cost items in aviation and prolonged growth almost always spills over, directly or indirectly, to passengers. In tourism-sensitive economies, such as Croatia, this effect can have broader consequences than ticket prices alone, because it affects the total cost of travel and the organisation of the supply chain connected with tourism.
The logic is similar for consumer goods. On shop shelves, not only products directly linked to oil or imports from crisis areas become more expensive. Higher fuel and delivery costs are felt in food, consumer goods, construction materials, electronics and pharmaceutical products, especially when it comes to goods crossing several borders or depending on precisely timed delivery. Inflation therefore does not necessarily return as one large energy shock, but often as a series of smaller, scattered price increases affecting everything from transport to packaging. It is precisely this pattern that creates the biggest problem for central banks, because formally energy can still remain in negative territory on an annual level, while secondary effects spread to services and industrial goods.
Disinflation exists, but it is becoming more fragile
The latest European data show that the process of easing inflation is real, but not completed. According to Eurostat’s flash estimate, annual inflation in the euro area in February 2026 amounted to 1.9 percent, after 1.7 percent in January. The same report shows that energy still remained in negative territory, at minus 3.2 percent, though less negative than a month earlier, while services remained the most stubborn component with an annual rate of 3.4 percent. This is an important signal for policymakers: the headline index is still close to the European Central Bank’s target, but underlying inflation has not disappeared, and energy is no longer acting as such a strong shock absorber as before.
In other words, the euro area entered 2026 with a more favourable inflation picture than two years ago, but without a large safety cushion. If energy starts rising again, overall inflation can accelerate relatively quickly. If more expensive transport begins to raise the prices of imported goods, underlying components can also remain elevated for longer than expected. In such an environment, every new geopolitical tension gains greater weight, because it occurs at a moment when inflation is indeed lower, but has not yet been fully tamed in all segments.
Central banks are therefore becoming more cautious
The European Central Bank gradually lowered its key interest rates in 2025, and the official table of interest rates shows that the deposit rate has been at 2.00 percent since 11 June 2025. This is an important change compared with the peaks of the previous period, but it does not mean that the room for further easing of monetary policy is unlimited. On the contrary, precisely the possibility of a new energy and logistics удар is the reason why financial markets and analysts are assessing the pace of future cuts with much greater caution. A central bank can reduce the price of money more easily when inflation is weakening for balanced and lasting reasons. When, however, there is a danger that an external shock will spill over into fuel, transport and goods prices, every new rate cut carries greater reputational and economic risk.
The European Central Bank also warns in its research papers that global supply-chain disruptions create more persistent and broader price pressures than is often assumed. Even more direct is a new paper by the International Monetary Fund, published in February 2026, according to which a delay in ship deliveries of 100 hours at the peak, about five months after the shock, can raise inflation by approximately 0.5 percentage points. This is especially important because it shows that logistics disruptions do not act only as a short-term disturbance. Their effect can be delayed, dispersed and long enough to be felt precisely at the moment when monetary policy is trying to move from a restrictive to a more neutral phase.
What this means for businesses and households
For companies, the biggest problem is uncertainty, not only the price level itself. When no one knows whether a tanker will pass within the usual timeframe, how much shipment insurance will cost, or whether the carrier will adjust prices next week, planning procurement, production and selling prices becomes more difficult. Companies then more often increase safety stocks, conclude more expensive alternative contracts and build risk into price lists in advance. All this raises operating costs and reduces efficiency, even before the shock has fully materialised.
Households, meanwhile, first feel the change in fuel and travel, but the story usually does not stop there. Higher transport costs over time spill over to delivery, retail, hospitality and a range of services that depend on energy and logistics. In countries with pronounced seasonality in consumption and tourism, this can be even more visible, because more expensive transport and fuel are quickly reflected in summer packages, airline routes, coastal supply and the prices of products with shorter delivery deadlines. In practice, this means that citizens often do not experience inflation through one official index, but through a series of everyday decisions that become more expensive in the same period.
Why there is no room for careless assessments
It is important here to avoid two extremes. The first is the claim that every jump in the price of oil automatically means a new major inflation cycle. The second is the belief that European economies are now resilient enough that an external shock can no longer significantly change the picture. According to the available data, reality lies between these two points. An energy shock today would probably not have an identical effect as in the most difficult period after the pandemic and the start of the war in Ukraine, because companies and states have partly adapted supply chains, while monetary policy is no longer set on extremely loose settings. Nevertheless, the current system remains sensitive to disruptions in several key chokepoints, especially when energy, shipping and insurance are disrupted at the same time.
That is why the economy today really follows every military and trade signal from the region. This is not only about daily politics, but about assessing how prolonged instability could change fuel prices, transport costs and central bank decisions in the months to come. If tensions ease, the effect may remain limited to short-term market nervousness. If they persist and deepen, inflation could return precisely through the channels that were believed to have started normalising: through energy, logistics and expectations about future prices.
Sources:- Eurostat – flash estimate of inflation in the euro area for February 2026, with data on overall inflation and the components of energy, services and food (link)- European Central Bank – official table of key interest rates, including the deposit rate of 2.00 percent from 11 June 2025 (link)- UNCTAD – review of maritime transport for 2025 on the continuation of disruptions in the Red Sea, the Suez Canal and the risks for the Strait of Hormuz (link)- UNCTAD, overview PDF report – data that ship tonnage traffic through the Suez Canal in early May 2025 was around 70 percent below the average from 2023 and that the Strait of Hormuz carries around 11 percent of maritime trade and more than one third of maritime oil exports (link)- IMF – paper from February 2026 on the effect of delays in ship deliveries on consumer prices and inflation (link)- ECB Research – research on how global supply-chain disruptions and energy shocks affect inflation in the euro area (link)- IATA – Jet Fuel Price Monitor with the information that the global average price of jet fuel rose to 99.40 dollars per barrel in the last week (link)- The Guardian – market report of 6 March 2026 on the sharp jump in the price of Brent crude and growing inflation fears due to the worsening security situation in the Middle East (link)
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