Rising tensions in the Middle East are already putting pressure on global energy markets, and economists warn that Bulgaria is likely to feel the impact through higher inflation in the second quarter of 2026, BNR reports. On Monday, March 9, European natural gas futures surged by 30% to over 69 euros per megawatt-hour, marking the highest level since early 2023. The spike comes after last week’s 67% rise, reflecting continued market uncertainty as winter draws to a close with EU gas storage significantly depleted. The need to replenish reserves is intensifying competition for liquefied natural gas, particularly from major importers such as China, India, and Japan.

Bulgarian economist Rumen Galabinov noted on the radio that while the country will experience rising gas prices, the impact will be milder compared with nations heavily reliant on imported natural gas for households and industry. He stressed that Bulgaria, as a Eurozone member, has been evaluated alongside other EU economies in 2026, a year that began with plans for ambitious structural reforms aimed at boosting growth and competitiveness across Europe. However, recent military developments, especially the escalation in Iran and the ongoing conflict in Ukraine, have shifted attention to international instability, with markets responding to rising crude oil prices. Prolonged conflict could strain not only European economies but also Asian markets, particularly China, India, and South Korea.

Galabinov predicted further increases in gasoline and diesel prices over the coming months. He highlighted Bulgaria’s ability to offset some of the pressure through its diversified energy mix, which includes nuclear power, renewable sources, and imports. Black Sea crude oil supplies and electricity balancing capacities can also help mitigate price shocks. Nevertheless, disruptions in Qatari LNG supplies, although limited in impact, add to the uncertainty. Overall, he foresees a gradual but inevitable rise in inflation in Bulgaria.

Trade unions tracking domestic fuel prices have already reported a 13% increase at gas stations. Atanas Katsarchev, chief economist at the Confederation of Labor “Podkrepa,” explained the direct link between fuel costs and inflation: a 10% increase in fuel prices generally translates into a 1% rise in overall inflation. He warned that with no active budget in place and uncertain oil supplies, Bulgaria faces significant economic risks. Citizens may see rising prices in the coming weeks, and government measures will be crucial to protect incomes. The Consumer Protection Commission has begun inspections, signaling heightened scrutiny, but immediate policy action remains unclear. The evolving conflict and its effects on energy markets underscore the need for preparedness and contingency planning at both the state and household levels.

Source: Bulgarian National Radio (BNR)