Ukraine conflict pushes cost of living in Spain further

MADRID, Feb. 22 (Xinhua) -- Just like the rest of Europe, Spain is still suffering from rising food and fuel prices on the first anniversary of the Ukraine conflict.

The conflict affects the budgets of households throughout the country, despite the government's attempts to keep prices as low as possible.

According to the Spanish Statistical Office (INE), prices rose by 8.4 percent in the country in 2022, peaking at 10.8 in July, almost three percentage points more than in February 2022, when the conflict broke out.

The price rises were mainly caused by the energy supply problems across Europe, which at the time was highly dependent on Russian gas and petroleum.

Spain and Portugal were able to negotiate the "Iberian exception" with the other member states of the European Union (EU), which protected them from the adverse effects of the rising gas prices as a relatively high proportion of their energy comes from renewable sources.

The cost of electricity in Spain still exceeded 200 euros (212 U.S. dollars) per megawatt-hour (MWh) in the middle of 2022, which pushed up household energy bills and production costs. The price hikes were eventually passed on to consumers.

Inflation in 2022 was 8.4 percent. Food and non-alcoholic drinks prices increased by 15.4 percent between January 2022 and January 2023, according to the INE.

Sugar became 52.1 percent more expensive, milk, butter and cooking oils cost over 30 percent more, and the prices of eggs, yogurt, flour and cheese increased by more than 20 percent.

At the start of 2023, the Spanish government scrapped value-added tax (VAT) on essential foods for six months and lowered it from 10 percent to 5 percent on pasta and olive oil.

The price of diesel and petroleum also rose sharply in 2022, with the former going up by 28.5 percent and the latter by 14.9 percent, according to the EU's Oil Bulletin. The sharpest price increases of 45.6 percent and 33.6 percent, respectively, came in March, shortly after the start of the Ukraine conflict.

Rising fuel costs prompted a 20-day strike by independent transport workers, which further increased the country's supply problems and put an extra strain on the households' budgets.