"The joint American and Israeli campaign against Iran has already driven up energy prices. Even if President Trump decides to end the conflict today, the damage has been done. Brent crude approached $120 a barrel on 9 March, its highest level since Russia's invasion of Ukraine. UK wholesale gas prices spiked to 171p per therm, far above the typical 78-85p average expected during late 2025."
"The Strait of Hormuz, crucial for 20% of global oil shipments, is being avoided by most vessels. Reduced flows through this chokepoint are expected to raise Europe's transport and logistics costs, hitting energy‑intensive industries such as chemicals and manufacturing across the UK and EU, ultimately raising prices."
"China is also likely to face significant challenges. It is particularly dependent on open access to the Strait of Hormuz. Around half of its oil imports pass through the Strait, along with essential minerals and chemicals such as naphtha and sulphur. Rising costs and supply volatility could lead to production cutbacks in China's industrial supply chains."
The Iran conflict is disrupting critical global supply chains and shipping routes for sea and air freight, creating significant economic consequences. Energy prices have surged, with Brent crude reaching $120 per barrel and UK wholesale gas prices spiking to 171p per therm. Major transport corridors face heavy disruption, particularly the Strait of Hormuz, which handles 20% of global oil shipments and is being avoided by most vessels. This disruption affects energy-intensive industries including chemicals and manufacturing across the UK and EU. China faces particular vulnerability, as half its oil imports pass through the Strait, along with essential minerals and chemicals. These cumulative costs will be absorbed throughout supply chains, resulting in higher prices for UK retailers, consumers, and exporters, with product shortages likely affecting items from consumer electronics to fast fashion.
#supply-chain-disruption #iran-conflict #energy-price-inflation #shipping-routes #consumer-price-impact
Read at London Business News | Londonlovesbusiness.com
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