Eugenia Gusilov discussed yesterday with Cristi Citre at Digi24 about the kerosene crisis in European civil aviation and the IMF recommendation that governments should not reduce taxes.

The main ideas highlighted during the discussion:

It is too early to celebrate, a fact confirmed by events when Iran closed the Strait of Hormuz again, not even a day after its so-called opening. It did not even last a day.

The aviation fuel crisis does not affect everyone in the same way. Countries with major aviation hubs such as London, Frankfurt, Paris, and Amsterdam will be more affected because demand in these connection nodes exceeds local kerosene production. On the other hand, countries like Poland, Romania, and Greece cover their needs. There are also completely vulnerable countries dependent on imports, such as the Republic of Moldova, and nations that closed refineries in recent decades due to environmental policies, like Great Britain, which dropped from 18 refineries in the 1970s to only 4 today.

The IMF recommendation advising governments against tax reductions must consider pre-crisis taxation levels. Situations vary, and individual contexts must be taken into account rather than applying general recommendations.

Overall, relaxation is not yet an option. The pressure on nerves and wallets will continue, especially as Iran has learned that blocking the Strait of Hormuz is an even more powerful weapon than possessing nuclear weapons.