Speaking during an economic forum on Thursday, Mudavadi urged governments and businesses to prepare for potential economic shocks as global oil prices continue to rise.
The Prime CS noted that the conflict and uncertainty in the Middle East, a region that plays a critical role in global oil production and supply chains, have already started affecting fuel prices and transportation costs worldwide.
He warned that countries heavily dependent on imported petroleum products, including Kenya, could face increased pressure on inflation, manufacturing, and food prices if the crisis escalates further.
Mudavadi emphasized that Kenya must begin exploring alternative energy solutions and strengthen regional trade partnerships to cushion the economy from external shocks.
According to him, relying heavily on imported fuel exposes countries to unpredictable global events that can cripple economic stability.
“We are entering a period where nations must think beyond traditional systems. The volatility in the Middle East should be a wake-up call for countries to diversify energy sources and secure alternative supply routes,” he said.
His remarks come at a time when global oil prices have shown signs of sharp increases amid fears of supply disruptions. Analysts have warned that prolonged tensions could trigger a fresh wave of economic strain, particularly in developing countries already battling high living costs and weakening currencies.
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The Prime CS also called on local businesses to adopt resilience measures, including reducing operational waste, investing in renewable energy, and embracing digital systems that can help cut costs during uncertain economic periods.
He stressed that both governments and the private sector must work together to prepare for possible market instability.
Economists say rising fuel prices could have a direct impact on transport, electricity, food production and consumer goods, potentially increasing the cost of living for ordinary Kenyans.
Public transport operators and manufacturers are among the sectors expected to feel the pressure first if global crude oil prices continue climbing.
Mudavadi further urged African nations to enhance intra-African trade and accelerate investments in renewable energy projects such as solar, wind and geothermal power.
He argued that reducing dependency on imported oil would help protect economies from geopolitical tensions beyond their control.
As uncertainty continues to grow globally, leaders across different countries are closely monitoring developments in the Middle East, fearing that prolonged instability could trigger broader economic disruptions across the world.
