Regarding the transmission of the Middle East crisis into prices in Estonia, Prime Minister Kristen Michal said he had asked relevant ministers to prepare proposals for the government.

"Regarding the Middle East crisis translating into our prices, I asked the ministers responsible yesterday, and I also spoke with our [coalition] partner Kristina Kallas, the chair of Eesti 200, to bring appropriate proposals to the government on Thursday. Among other things, we could consider canceling the excise duty increases planned for this year, for example, so that rising prices on the global market would not feed directly into our price increases," Michal told Vikerraadio Tuesday.

"All these proposals will come to the government on Thursday because this is how the government works: we first base our decisions on calculations. We request the calculations and assessments and then we make decisions," he added.

Asked how much damage the war in Iran could cause to the Estonian economy, Michal said it largely depends on how long the conflict lasts.

"Most analysts say it depends on the duration and intensity of the conflict. If the conflict is limited in time and, say, in a month the Strait of Hormuz is freely passable again, fuel trade resumes and LNG plants in Qatar are restarted — which have currently been temporarily shut down for safety reasons — then it will probably remain a one-off spike, although it will take some time for prices to normalize," the prime minister said.

"And that is why I say we could consider the impact of canceling this year's fuel excise duty increase, so that it would help us get through this so-called crisis," he added.

Michal also expressed hope that the crisis will be short-lived.

"If the crisis is short-term, it will probably not deal such a major blow to the economy. And I would also say that Donald Trump said his interest is to bring global energy prices down rather than push them up," the prime minister noted.

"So I believe it is more likely that once the military objectives have been achieved, efforts will immediately be made in that direction — to normalize energy flows. And if that happens, well, we hope that just as price increases reached Estonia at quantum speed, the decline will reach Estonia at quantum speed as well. Nevertheless, the Estonian government will also take various steps so that people in Estonia do not have to bear excessive pressure from rising prices spilling over here," he said.

Under current plans, excise duties on gasoline and diesel fuel, heating oils, natural gas and electricity are set to rise in Estonia from May 1, 2026, with the gasoline excise rate increasing by 5 percent and diesel by 7 percent.

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