One billion euros. This is the monstrous figure that, according to the Confindustria research center, could be reached in Sardinia's price increases due to the war in Iran.

The conflict sparked by the attack by Israel and the United States risks resulting in a new and serious energy shock for the island, with direct effects on the costs borne by families and businesses "and with significant repercussions on the competitiveness of the regional production system."

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The report, titled “Iran Conflict and Energy Price Rises: An Assessment of the Potential Impact for Sardinia,” was published today.

The analysis examines two main channels of transmission of the shock: on the one hand, electricity, the price of which is affected by the trend in natural gas , and on the other, land transport fuels, influenced by Brent prices.

Based on consumption in recent years, potential increases in energy costs are calculated under three different scenarios, based on slight, moderate, and severe increases in international gas and oil prices, respectively.

According to the report, even in a scenario of relatively mild increases, the increased annual energy costs for Sardinia would still be approximately €270 million per year. In the second scenario, with moderate increases, the increase would rise to approximately €631 million. In the third, most severe, scenario, the overall impact would reach nearly €1 billion per year.

The Confindustria Research Center warns that this latter scenario "should not be considered a textbook case or a remote possibility, as it is based on the assumption that prices will remain in line with those reached a few days ago over the long term: a scenario, moreover, already seen during the early stages of the war in Ukraine."

The clear message emerging is that "our region remains highly exposed to international tensions in the energy markets," says Andrea Porcu, director of the Confindustria Sardegna Research Center. "The current crisis demonstrates the need to safeguard national refining and fuel supply capacity. Brent price hikes cannot be avoided, but a stronger supply chain helps contain the risks of shortages and bottlenecks that would generate even more serious strains on the economy. This makes it even more urgent to strengthen energy security, cost stability, and competitiveness for Sardinian businesses."

On the electricity front, even in the mild increase scenario, price increases would result in an increase of €51.16 million for household consumption and €130.44 million for non-household consumption, of which €75.71 million would be attributable to industry. In the most severe scenario, the estimated increase in electricity prices would well exceed half a billion euros, with nearly €230 million in additional costs borne by Sardinian industry.

Regarding transportation, the report highlights that diesel is the most exposed component, both due to the greater pass-through effect of price increases and the larger volumes consumed on the island, which are higher than those of gasoline.

The overall increased annual cost for fuel is estimated at approximately 89 million euros in the first scenario, 268 million in the second and 446 million in the most severe scenario.

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