Spain | A rise in oil prices is bad news for Spain

Spain is both less energy efficient – it requires more energy to produce one unit of output – and more reliant on oil than its European peers. This means that changes in the price of crude take a larger toll on economic activity than in other eurozone economies.

What you will learn from this report:

• The energy component of the consumer basket in Spain is larger than the average in the eurozone, so a rise in oil prices also has a bigger impact on inflation.
• The rise in crude prices will also damage Spain’s external balances given the large amount of imported oil.
• We expect the energy bill will be €8bn higher than in 2020, a sum equal to the current account surplus recorded last year.