The Iranian drone attack on British bases in Akrotiri at midnight on Sunday, combined with the wider escalation in the Middle East following US and Israeli strikes on Iran, has thrust Cyprus into the epicentre of the geopolitical crisis.
Beyond the obvious security concerns, the impact is already being felt on the island’s economy and business community, with implications ranging from shipping and fuel to tourism and the supply chain.
"The situation is fluid"
“The situation is quite fluid and no estimations can be made with certainty,” Michael Antoniou, Director General of the Cyprus Employers & Industrialists Federation (OEB), told InBusinessNews. OEB convened an emergency meeting under its President, George Pantelides, to assess the economic and business implications of the crisis, while at the same time establishing a special support group for businesses of Cypriot interests facing problems in the war-torn areas.
Despite the uncertainty, Antoniou identified some positive points. “The Straits of Hormuz have not been closed. Navigation is becoming quite difficult, with precautions, delays and increased insurance premiums, but they remain open — and that is considered a very good sign,” he stressed.
Supply chain and prices under pressure
The Secretary General of the Cyprus Chamber of Commerce and Industry (CCCI), Philokypros Roussounides, stated that "the closure of the Straits of Hormuz will create specific anomalies in the supply chain and in the country's commercial activity and beyond." "It will be an additional cost and challenge for the supply chain," he said, mainly highlighting issues of timely delivery.
Oil costs are further exacerbating the picture. Brent jumped as much as 13% at the opening of the markets, with reports of prices that could exceed $100-120 per barrel. Roussounides pointed out that if the conflict continues for several weeks, “there may be some problems,” calling for calm and emphasising that the CCCI is assessing the situation hour by hour.
Fuel: 15 days of supply, alternative purchases on the table
Regarding fuel adequacy, Petrolina's CEO, Dinos Lefkaritis, denied shortage scenarios. "There is no concern that we will run out of fuel. We currently have 15 days of stock, which is considered satisfactory for Cyprus." However, he admitted that imports from the Israeli Haifa refinery may be suspended, stressing that there are alternative supplies from VTTV, Greece, Malta and Italy. "Petroleum products are very unpredictable. Anything can happen," he said of prices.
60 flight cancellations — Concern for tourism
The practical impact of the crisis was visible early on. According to Hermes Airports, 60 flights were canceled as of noon on Monday, 2 March, to and from Larnaca and Paphos airports, 42 in Larnaca and 18 in Paphos. Passengers are urged to contact airlines or travel agents before going to the airports.
The Cyprus Hotel Association (PASYXE) is also on alert. “We are maintaining composure, we are constantly evaluating developments,” said PASYXE Director General Christos Angelides, noting that this week a delegation is in Germany for contacts with major tour operators. When asked about possible cancellations of reservations or a slowdown in advance bookings, Angelides replied that “it is too early to say anything,” expressing hope for normalisation in the coming days.
Shipping in turmoil — International giants are withdrawing
Internationally, the picture is worrying for shipping, a sector crucial to Cyprus. DP World has suspended its operations at Dubai's Jebel Ali port, the largest container terminal in the Middle East, while MSC Mediterranean Shipping Company has suspended all cargo bookings to the region. Maersk has announced a bypass of the Suez Canal and a rerouting of ships around the Cape of Good Hope.
The Deputy Ministry of Shipping of Cyprus issued a circular recommending to Cyprus-flagged ships the implementation of ISPS level 3 security measures and a reassessment of transit through the Strait of Hormuz.
Limassol Port Readiness — Christodoulides' Message
The port of Limassol is on standby to activate the ESTIA national plan, to receive citizens from war-torn areas, while the Port Authority is implementing increased level 2 security measures. "We are on standby. There is no request for evacuation so far," said Port Master Panayiotis Agathocleous.
President Nikos Christodoulides, after convening an emergency session of the National Council, sent a message of calm: "Our homeland does not participate in any way in any military operation. We do what is right with our primary concern being the security of the country and its citizens."
The common message from business operators and authorities remains the same: vigilance without panic, composure under pressure, and assessment hour by hour — in an ever-changing environment.
(Source: InBusinessNews)
