Middle East War Raises Risk of Global Food Price Shock

The escalating conflict in the Middle East is increasingly raising concerns about a potential shock to global food prices, as disruptions to trade routes threaten to ripple beyond energy markets. In particular, instability around the Strait of Hormuz has begun to affect supply chains for energy and fertilizers, both of which are crucial inputs for global agricultural production.

The Strait of Hormuz, through which roughly one‑fifth of global oil supply passes, has become a key flashpoint in the conflict. Rising oil and natural gas prices linked to the crisis are increasing production costs across the agricultural sector. Higher energy prices typically translate into more expensive fertilizers, transportation and food processing, which can ultimately push up prices for staple commodities such as wheat, corn and vegetable oils.

The region also plays an important role in global fertilizer production. Countries including Saudi Arabia, Qatar and Iran are major producers of urea and phosphate-based fertilizers used by farmers worldwide. Any prolonged disruption to exports or logistics from the region could tighten global fertilizer supply and raise input costs for farmers ahead of key planting seasons.

Economists warn that the impact would likely fall hardest on developing economies. Farmers in parts of Africa and other emerging markets may struggle to afford higher fertilizer prices, potentially reducing crop yields. At the same time, countries that rely heavily on imported food could face accelerating food inflation, raising concerns about food security and increasing pressure on global agricultural markets.