The UN Trade and Development (UNCTAD) has warned that escalating military tensions in the Strait of Hormuz are disrupting one of the world’s most critical maritime chokepoints, with ripple effects threatening energy markets, maritime transport, and global supply chains.
According to UNCTAD’s Rapid Impact Analysis, the Strait carries around a quarter of global seaborne oil trade, as well as significant volumes of liquefied natural gas and fertilizers. The disruption has already pushed Brent crude prices above $90 per barrel, raising concerns about higher energy, fertilizer, and transport costs. These increases—spanning freight rates, bunker fuel, and insurance premiums—could drive up food prices and intensify cost‑of‑living pressures, particularly for vulnerable populations.
UNCTAD noted that similar repercussions were seen during the COVID‑19 pandemic and the early stages of the war in Ukraine, when shocks in energy, transport, and agricultural inputs spread rapidly across interconnected markets. The current crisis comes at a time when many developing economies face high debt burdens, limited fiscal space, and reduced capacity to absorb new price shocks.
The agency stressed that the overall impact will depend on the duration and scale of the disruption, but emphasized the need for continued monitoring. It highlighted the importance of safeguarding maritime transport, ports, seafarers, and civilian infrastructure, while maintaining secure trade corridors in line with international law and freedom of navigation.
UNCTAD warned that rising energy and food costs could strain public finances and household budgets in developing countries, complicating progress toward sustainable development and heightening socio‑economic pressures. (Newswire)
Read more: https://unctad.org/publication/strait-hormuz-disruptions-implications-global-trade-and-development?utm_source=facebook&utm_medium=social (Newswire)
