Tensions in the Middle East could disrupt global supply chains for fertilizers and energy, potentially triggering a rise in food prices worldwide, experts warn.
As reported earlier Svein Tore Holsether, CEO of fertilizer giant Yara, told the Financial Times that the conflict poses a risk to vital maritime routes. According to Holsether, 40% of global urea shipments and 20% of liquefied natural gas (LNG) exports pass through the Strait of Hormuz—a chokepoint that could become a geopolitical flashpoint.
High energy prices have already proven capable of destabilizing the global food system, as seen during the ongoing war in Ukraine.
What Does This Mean for Azerbaijan?
Could rising global tensions impact food prices in Azerbaijan? Experts are divided.
Economist Khalid Kerimli believes the immediate threat has passed:
“I think this was more of a concern last week. At the peak of the conflict, there was real fear Iran might close the Strait of Hormuz, disrupting cargo shipments. But the fighting has stopped, the threat didn’t materialize, and oil prices are already declining. As of now, there’s no justification for food price hikes in Azerbaijan”.
Still, other analysts urge caution.
Risk Not Gone, Says Expert
Economist Rashad Gasanov says the risk of price increases shouldn’t be dismissed:
“Any rise in geopolitical tension creates ripple effects across the economy, including food production and logistics,” he said. “If the Strait of Hormuz were to shut down or see major disruption, alternative shipping routes would drive up transport costs and cause delivery delays—triggering short-term price shocks across supply chains.”
He explained that food production is heavily dependent on energy, which can account for anywhere from 10% to 45% of costs for certain crops. Any spike in global energy prices, Gasanov warned, could accelerate food inflation.
He also noted that the ongoing war in Ukraine continues to affect the supply of key food commodities:
“Neither Russia nor Ukraine is operating at full agricultural capacity, and that intensifies supply risks. While the Strait of Hormuz remains open for now, providing short-term stability, the bigger threats—global food inflation, climate change, and drought—remain very real.”
Gasanov concluded by urging Azerbaijan’s government to stay proactive and prepared:
“Authorities must closely monitor developments and propose measures to manage these risks effectively.”
