Analysis for StandardPrva.ba, by Božana Simić, M.A., and Miloš Stevanović, Attorney at Law, Stevanović Law Office

While investors in recent years have focused primarily on interest rates, inflation, and the technology sector, events in the first half of 2026 have reminded the world of an old economic truth: energy and geopolitics still possess the power to alter the course of the global economy within days.

Military developments in the Middle East and the closure of the Strait of Hormuz have caused serious disruptions in global energy markets. A significant portion of the world’s oil and natural gas trade passes through this narrow maritime corridor, meaning that any disruption to its operation has an almost immediate impact on fuel prices, transportation costs, and industrial production worldwide.

Falling Oil Prices Are Not the End of the Problem

In recent days, markets have reacted positively to reports of a potential agreement between the United States and Iran. Oil prices have fallen below $80 per barrel, marking the first time since the beginning of the conflict that markets have shown significant optimism.

However, experienced analysts warn that markets may be declaring victory too soon. Although political agreements have been announced, shipping traffic through the Strait of Hormuz has not yet fully normalized, while insurers and transportation companies remain cautious. The consequences of disruptions in energy supplies are often felt for months after hostilities have ended.

In other words, the price of oil today depends not only on how much oil is produced but also on perceptions regarding the security of global trade routes.

Central Banks Once Again in a Difficult Position

When energy prices rise, central banks face a highly complex situation.

On one hand, more expensive energy fuels inflation. On the other, it slows economic growth by increasing costs for businesses and reducing consumers’ purchasing power. This is the classic scenario economists describe as “stagflationary pressure” — a combination of slower growth and higher inflation.

For this reason, the European Central Bank remains cautious despite some easing of geopolitical tensions. Inflation in the euro area continues to hover above desired levels, while economic growth remains weak.

A similar situation is evident in France, where the central bank recently lowered its economic growth forecast for 2026 due to energy shocks and weaker economic activity.

What Does This Mean for Bosnia and Herzegovina and the Region?

Bosnia and Herzegovina is not a direct participant in global geopolitical conflicts, but it is an integral part of the global economic system.

When energy prices rise:

• transportation costs increase,

• production costs rise,

• imported goods become more expensive,

• industrial activity in the European Union slows,

• demand for goods from the region declines.

It is particularly important to emphasize that the European Union is our most important trading partner. Any slowdown in the German, Italian, or Austrian economies is quickly reflected in the operations of companies in Bosnia and Herzegovina.

For domestic businesses, this means that the coming period will require more cautious cash-flow planning, stricter inventory management, and tighter cost control.

Gold and Safety Back in Focus

One of the most interesting consequences of global uncertainty is the continued strong demand for gold.

Central banks around the world continue to increase their gold reserves in order to reduce dependence on geopolitical risks and currency shocks. Gold is once again proving itself as a store-of-value asset during periods of heightened uncertainty.

This does not mean that investors should rush to buy precious metals in panic, but it does demonstrate how even the world’s largest financial institutions are preparing for an environment in which geopolitical risks are likely to remain present for years to come.

A Lesson for Businesses

Perhaps the most important lesson of 2026 is that economics cannot be viewed in isolation from politics.

A single decision made in Washington, Tehran, or Riyadh today can change production costs in Bijeljina, Banja Luka, or Sarajevo tomorrow. Globalization has not disappeared — it has merely changed its form.

At a time when artificial intelligence, digital currencies, and technological innovations dominate headlines, 2026 serves as a reminder that oil, energy, and geopolitical stability remain the foundations upon which the modern global economy rests.