Finance Minister Fayval Williams has suggested that the Government will intervene if oil prices skyrocket in light of the ongoing war in the Middle East.

“We would begin to be very concerned about the impact, depending on how long the war goes on. In the near term, we will see the first effect of it through [increasing] oil prices here in Jamaica,” Williams said while noting that the war, which started February 28, is still in its first week.

She was responding to questions from Opposition spokesman on finance Julian Robinson about the likely impact of the war during Thursday’s meeting of Parliament’s Standing Finance Committee examining the 2026-2027 Estimates of Expenditure.

“We expect consumers in the near term to manage their budgets accordingly. Again, it’s going to depend — the longer term impact of it — whether or not Government will be required to assist will depend on the duration of the war,” Williams explained.

“It’s something that we’re watching closely and, of course, if Government is required to assist, that is something that the Cabinet will deliberate on, then there will be an announcement to the country,” she added.

Oil prices have shot up globally since Saturday when the United States and Israel launched air strikes on Iran. The aerial bombings have continued all week.

Iran has responded by launching missiles and drones at Israel and at US army bases and personnel throughout the Middle East. Analysts have said oil prices could surge well beyond the US$100 mark the longer the war drags on, especially since Iran has attacked oil infrastructure in several Gulf states and has effectively closed the Strait of Hormuz through which 20 per cent of global oil and gas pass.

Robinson noted that rising oil prices will likely have a two-fold impact on the economy. On the one hand, he said it will have a balance of payment effect but, on the other, will result in more tax revenues.

With that being the likely scenario, Robinson asked Williams, “What contingencies are in place to deal with the likely impact of inflation from increasing oil prices, particularly on the most vulnerable?”

Meanwhile, Williams shared that the Government was “very encouraged” by a report this week from the Planning Institute of Jamaica (PIOJ) that the anticipated decline in gross domestic product (GDP) output in the fourth quarter of 2025 as a result of the fallout from Hurricane Melissa was not as bad as initially thought.

According to the PIOJ’s revised estimate of loss and damage following the hurricane, Jamaica was impacted to the tune of US$12.2 billion or approximately 57 per cent of GDP in 2024. This is up from the earlier estimate of US$8.75 billion or 41 per cent of GDP.

“We did not benefit from this updated data before we tabled the budget document on February 12, 2026 as is required, regardless of what else is going on around us,” Williams said.

She noted that the budget was being presented in the context of the damage caused by the hurricane, and “additionally, as of Saturday, February 28, 2026, we learned from the global news sources that the United States and Israel launched an attack on the nuclear capabilities of Iran”.

The finance minister said that, “In a week, we’ve seen oil prices go from about US$64 per barrel to US$74, an increase of about 16 per cent.” She also highlighted that the Middle East produces more than 30 per cent of the world’s oil, making it the leading oil-producing region.

“Jamaica is an importer of oil and so what happens to oil prices on the global market is expected to have an impact on Jamaica,” Williams said.

“As a Government, we have a focus on energy security,” she said, while noting that the State-owned oil refinery Petrojam continues to provide that security as the Administration looks to expand energy sources.