BCRD projects US$900 million increase in Dominican energy bill

Santo Domingo.- The Dominican Republic’s energy bill is expected to climb to approximately US$5.4 billion this year, nearly US$900 million above initial projections, as rising global oil prices driven by the conflict involving Iran continue to impact fuel costs and inflation, according to the Central Bank of the Dominican Republic (BCRD).

In a recent analysis, the Central Bank warned that disruptions to global oil supplies caused by the war have increased economic pressure worldwide, particularly through higher fuel and energy prices. The institution noted that the closure of key shipping routes through the Strait of Hormuz — a major corridor for global oil and gas trade — has contributed to the surge in crude oil prices. As a result, annual inflation in the Dominican Republic reached 5.11% in April, surpassing the official target range of 4% ±1%.

Despite the increase in inflation and energy costs, the BCRD emphasized that the Dominican economy continues to show resilience, supported by 4.1% economic growth during the first quarter of the year and international reserves exceeding US$15.8 billion. The bank expects inflationary pressures to ease in the coming months if international supply conditions stabilize, projecting inflation could close the year near 4.5%, while core inflation has remained within the target range for nearly three years.