stockpiling by
consuming
uncertainties in supply
of
countries in the face of the
will tend to offset at least part
the increased production from other suppliers. More
seriously,
any incident of direct confrontation between the
Iraqi and US military forces or of attack by Iraq on Saudi
production facilities will heighten
Arabia's
oil
nervousness in
outlook for the
the market immediately. A more pessimistic
near term would hence imply the crude oil
price rising to more than US$30 per barrel, or even above
US$35 per barrel if the
full-fledged war.
confrontations
Effect on inflation and production cost.
develop
into a
ጉ
8.
On consumer
price inflation in Hong Kong, three
types of impacts can be expected from an upsurge in the
prices of oil products.
due
to
households;
These are firstly, a direct impact
ás
the higher prices of oil-based fuels consumed by
secondly, an indirect impact
the higher
prices of oil-based fuels consumed by local producers get
reflected in the prices of their finished products for
local consumers; and thirdly, a longer-run impact owing to
imported inflation, as foreign suppliers of our consumer
goods pass over the effect of the oil orina hike.
9.
Various feedback suggests that the prices of oil
products in Hong Kong are likely to rise by around 10% over
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