Geopolitical Tensions Drive Potential Fuel Price Increases

Rising tensions in the Middle East, particularly concerning the Strait of Hormuz, are contributing to increased oil prices and could lead to higher fuel costs for consumers. The situation is being closely monitored by fuel traders and industry experts in Latvia and globally.

Impact on Global Oil Markets

Approximately 20% of the world’s oil and liquefied natural gas is transported through the Strait of Hormuz. Any disruptions to shipping in this critical waterway have an immediate negative impact on global oil supplies and, on oil product prices .

As of February 28, 2026, exchange prices for petroleum products had increased by around 20% compared to the previous week. This increase is largely attributed to the escalating conflict between Israel and Iran, including reported strikes by both nations against each other’s targets .

Latvian Fuel Market Response

Fuel dealers in Latvia typically purchase fuel products at stock exchange prices. Sustained high prices are likely to translate into gradual increases at Latvian gas stations. The speed of this increase will depend on individual dealer logistics and existing fuel reserves.

Ieva Ligere, executive director of the Latvian Association of Fuel Traders, confirmed that the tension in the Middle East and disruptions in the Strait of Hormuz have already caused a sharp rise in oil prices on global stock exchanges . She emphasized that fuel prices in Latvia are directly linked to both stock market prices and the euro-to-US dollar exchange rate.

Representatives from SIA “Neste Latvija” and SIA “Circle K Latvia” also acknowledged the impact of global events on fuel prices, noting that numerous factors – including world market prices, exchange rates, taxes, and local competition – contribute to price fluctuations at the pump .

OPEC+ Production and Future Outlook

On March 1, 2026, the OPEC+ alliance agreed to increase oil production by 137,000 barrels per day in April, a smaller increase than previously discussed. However, Gatis Titovs, fuel category manager at Circle K Latvia, cautioned that increased production does not guarantee price stabilization, as safe transit through the Strait of Hormuz remains a critical factor .

Predicting specific fuel prices remains challenging due to the interplay of multiple variables, including exchange rates, domestic competition, and the evolving geopolitical situation. Industry experts agree that the situation is uncertain and requires continued monitoring.

Virši-A’s Position

Jānis Vība, chairman of the board of JSC “Virši-A,” stated that the current geopolitical situation does not and will not affect the execution of fuel supply contracts concluded by the company with fuel producers . Virši-A, operating under the “Virši” brand, is a significant player in the Latvian energy resource trading market .

As of late 2024, Virši-A operated 82 fuel stations across Latvia, employing over 872 people . The company’s revenue reached 380.6 million euros in 2024, with net income of 4.67 million euros .