The Basel Bank for International Settlements, also known as the “Central Bank of Central Banks,” has warned that a move away from fuel from Russia could lead to widespread use of grain as a biofuel, further fueling the food shortages that began after anti-Russian sanctions. This will also lead to an increase in oil prices.
“Persistently high oil prices could put upward pressure on grains and oilseeds prices through increased use. Price changes relating to these crops, which are the main livestock feed, can quickly be reflected in other food prices,” BIS noted.
Recall that the rise in energy and food prices led to record inflation in most countries of the world. Therefore, it is necessary to raise interest rates in order to reduce inflation, but this will lead to a fall in the economy.
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