Rising International Energy Prices Could Hit Tunisia’s Economy Directly and Indirectly
By Moez Hdidane, economist and financial expert – March 9 2026
Key Take‑aways
- Energy‑price shock may affect Tunisia’s state budget, inflation and trade balance.
- The 2026 Finance Law was built on a $63.3 /barrel oil assumption and earmarked ≈ 5 billion TND for energy subsidies – lower than 2025.
- Current market reality (average $68/barrel up to 8 March) already threatens an extra cost of TND 0.9‑1 billion for the state.
1. How the budget was drafted
| Item | Figure in the 2026 Finance Law |
|---|---|
| Oil price assumption | US $63.3 per barrel |
| Energy‑subsidy envelope | ≈ 5 billion TND (down from 2025) |
The law assumed a relatively modest oil price, but recent spikes could overturn those projections.
2. Current price gap
- Average oil price (Jan 1 – Mar 8, 2026): ≈ $68/barrel
- Difference vs. budget assumption: + $5.5/barrel
Potential fiscal impact: TND 0.9‑1 billion extra outlay for subsidies.
3. Possible price‑scenario outcomes
| Scenario | Expected average oil price 2026 | Deviation from budget assumption | Estimated extra subsidy cost | % increase over original budget |
|---|---|---|---|---|
| Baseline | $68 | +$4.7 | – | – |
| Moderate rise | ≈ $80 (stable for the rest of the year) | + $16.7 | ≈ TND 2.4 billion | ≈ +25 % |
| Pessimistic | ≈ $90 (peak) | + $26.7 | ≈ TND 3.7 billion | > +50 % |
“If oil settles around $80, the annual average could hit $78, pushing the subsidy bill up by roughly 2.4 billion TND – a quarter more than planned,” explains Hdidane.
4. Two policy routes for the Tunisian state
-
Absorb the higher subsidy cost
- Keep domestic fuel prices unchanged.
- Result: Larger fiscal deficit.
-
Trigger the automatic fuel‑price adjustment mechanism
- Pass part of the cost onto consumers.
- Note: The last activation was November 2022; no price revisions have occurred since.
5. Risks of imported inflation
- Energy‑import bill (2025): ≈ TND 13 billion.
- If high oil prices persist, the bill could climb to ≈ TND 17 billion, adding ≈ TND 4 billion to the energy‑trade‑balance deficit.
Spill‑over effects
- Higher European energy costs → increased prices for imported goods in Tunisia.
- Potential drop in European demand for Tunisian exports, tightening the trade balance and depleting foreign‑exchange reserves.
6. Call for stronger energy sovereignty
Hdidane stresses that accelerating renewable‑energy investments is the strategic answer to shield the Tunisian economy from volatile global energy markets, especially amid:
- Ongoing geopolitical tensions.
- High volatility in world energy prices.
“Developing the renewable sector is one of the few levers we have to protect our economy from price swings,” he concludes.
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Source: Express FM interview with economist Moez Hdidane, 9 March 2026.
