Africa Faces Soaring Fuel and Food Prices as Strait of Hormuz Disruptions Escalate
Kampala — Africa is bracing for a sharp rise in fuel and food prices as geopolitical turmoil in the Strait of Hormuz disrupts global oil and fertilizer supplies, warns the Africa Supply Chain Confederation (ASCON). The strategic waterway, a lifeline for global energy and agricultural trade, has been partially blocked and militarized due to the ongoing conflict involving Iran, sparking concerns about its far-reaching economic impact on the continent.
Ronald Mlalazi, President of ASCON, emphasized the severity of the situation. “This isn’t just an oil story,” he said. “The Strait of Hormuz moves fuel, fertilizer, petrochemicals, plastics, and liquefied natural gas. For Africa, this disruption hits at the core of our supply chains and economies.”
Under normal conditions, approximately 25% of the world’s seaborne oil travels through the Strait of Hormuz. Today, its partial blockade has triggered what Mlalazi calls “the largest disruption in oil market history,” affecting nearly 30% of global oil flows, according to the International Energy Agency (IEA). Oil prices are already surging, with analysts predicting that crude could reach $150 to $200 per barrel if the crisis persists for another four to eight weeks.
But the ripple effects extend far beyond oil. Fertilizer prices have skyrocketed, with urea costs rising by 50% since the conflict began. For African nations heavily reliant on Middle Eastern imports, this spells trouble. Countries like Kenya, Tanzania, Ethiopia, and Zambia, which import over 50% of their fertilizer via the Hormuz route, are already implementing emergency measures such as subsidies and reserve releases.
“When farmers miss planting windows due to fertilizer shortages, the consequences are dire,” Mlalazi explained. “Food prices spike, yields drop, and inflation worsens. In economies where food already dominates household budgets, this isn’t a marginal issue—it’s systemic.”
A recent UN Trade and Development Agency (UNCTAD) report underscores these concerns. Titled From Gas to Grain: Fertilizer Disruptions Raise Risks for Food Security and Trade, the report highlights how disruptions in energy and fertilizer flows are escalating food insecurity and trade risks, particularly for vulnerable economies.
The report notes that natural gas prices, a key input for nitrogen-based fertilizers like urea and ammonia, have doubled in Asia and risen sharply in Europe. As production costs climb, fertilizer prices are pushed higher, exacerbating access challenges for Africa’s poorest nations. For instance, Sudan imports 54% of its fertilizer through the Persian Gulf, while Tanzania and Kenya rely on the same route for 31% and 26% of their supplies, respectively.
“Many import-dependent economies lack the fiscal space or financial flexibility to absorb these price increases,” the UNCTAD report stated. “They face tight budgets, external imbalances, and limited access to finance, leaving them vulnerable to rising costs.”
The logistics sector is also feeling the strain. Major shipping lines have begun rerouting vessels around the Cape of Good Hope, adding weeks to transit times and driving up freight costs. Bunker fuel prices have nearly doubled, and war risk insurance premiums have surged, with some insurers withdrawing coverage altogether for Persian Gulf operations.
“Diesel is the bloodstream of African logistics,” Mlalazi noted. “Higher oil prices mean increased transport costs, freight tariffs, and shipping surcharges. Retailers and fast-moving consumer goods companies will face margin compression.”
The crisis underscores Africa’s vulnerability as a net importer of fuel and fertilizer. “Africa is a price taker,” Mlalazi said. “We have little control over global shipping routes and are highly exposed to disruptions. This isn’t a distant war—it’s a supply chain event with immediate commercial consequences.”
As the crisis unfolds, Mlalazi warns that businesses must act swiftly to mitigate its impact. “If the Strait of Hormuz remains unstable for another month, Africa won’t just face higher prices—we’ll contend with slower trade, tighter margins, and rising food insecurity. Those who prepare early may seem paranoid today, but they’ll be exceptionally well-positioned in thirty days.”
The escalating crisis serves as a stark reminder of how geopolitical conflicts in one region can reverberate across the globe, hitting Africa’s economies hardest. As governments and businesses scramble to respond, the continent watches nervously, hoping for a resolution before the situation worsens.
— Reported by Nexio News
