Sweden has said the impact of the ongoing conflict in the Middle East is expected to be significantly worse for the country’s economy than previously assessed.
The warning was issued at a press conference attended by Prime Minister Ulf Kristersson and Finance Minister Elisabeth Svantesson, although no new policy measures were announced, the broadcaster SVT reported on Thursday.
“It is a messy and dangerous world in many ways,” Kristersson said.
According to the government, Sweden now faces a higher risk of inflation, weaker economic growth, rising unemployment and increased interest rates than previously forecast.
“We have now moved from the main scenario of limited impact to the scenario of significant impact on the Swedish economy,” Kristersson said.
Oil prices climbed above $102 per barrel on Thursday as tensions in the Strait of Hormuz resurfaced, outweighing the impact of an extended ceasefire between the US and Iran.
The prices had initially eased after US President Donald Trump extended the ceasefire with Iran. However, reports that Iran intervened in two foreign vessels over alleged security violations in the Strait of Hormuz pushed prices back toward the $100 level.
