Mideast unrest could cost Germany’s industry €15bn - chamber

25 February 2011 17:28  [Source: ICIS news]

TORONTO (ICIS)--The ongoing turmoil in Libya and elsewhere in the oil and gas-rich North Africa and Middle East regions could cost Germany’s industrial producers €15bn ($21bn) this year, because of higher oil prices, an analyst at the country’s chamber of commerce said on Friday.

If oil prices stayed at their current levels for the full 12 months of 2011, the increase would average 30% from 2010, said Felix Neugart, North Africa expert at Berlin-based DIHK.

Each 1% increase in oil prices translated into €500m in additional costs for Germany’s industry, resulting in estimated total additional costs of €15bn this year, Neugart said.

Producers in Germany’s chemicals, metals and transport industries would be able to pass on part of the increased costs to customers, but not all, he said.

“The remainder [of the cost increase] will cut into profit margins, and that money will then not be available for investments and the creation of new jobs,” he said.

However, longer term, the changes in North Africa and the Middle East could be a business opportunity for Germany’s industrial firms, he said.

On 24 February, BASF CEO Jurgen Hambrecht said the situation in Libya remained “very serious and very difficult to assess”.

BASF’s Wintershall energy business unit has shut down 100,000 bbl/day of oil production in Libya and evacuated international staff, Hambrecht said.

($1 = €0.72)

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By: Stefan Baumgarten
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