Iran’s blockade of the Strait of Hormuz, through which a quarter of global seaborne oil and a fifth of global liquefied natural gas is shipped, has had sweeping implications worldwide.
Rising gas prices amid the Iran war have sparked panic-buying lines and shortages at gas pumps. Other supply chains, such as fertilizer and seafood, could also be in peril.
“Past crises — including COVID-19 and the war in Ukraine — showed how disruptions to energy, transport, and agricultural inputs can quickly spread across interconnected markets,” the UN Conference on Trade and Development wrote in a report released March 10.
Here’s how countries and consumers around the world are feeling the effects of the Iran war.
On Sunday, motorists in Suzhou in eastern China lined up to fill their tanks ahead of an announced gas price hike.
China’s National Development and Reform Commission had initially announced that the set average price of gas would rise from $4.20 a gallon to $5.10 a gallon, an increase of 90 cents, The New York Times reported. On Monday, the agency said the planned increase would be lowered to 50 cents, bringing the price to $4.70 a gallon.
Customers in Santiago, Chile, also rushed to gas stations on Tuesday ahead of a 54% increase in fuel prices.
Jorge Quiroz, Chile’s finance minister, announced that the price hikes would take effect on Thursday, sparking panic buying as vehicle owners sought to fill their tanks before the change.
In Bangkok, gas stations faced fuel shortages.
Some pumps featured signs reading “out of stock” or “awaiting delivery.”
In some parts of Los Angeles, gas prices exceeded $8 per gallon.
As of March 25, the average price per gallon of regular gasoline in California was $5.831, according to AAA. The national average across the US was $3.983 per gallon.
Gas prices in California are typically higher than the rest of the country due to state taxes, stricter environmental regulations, including “cleaner” gas blends, and limited supply compared to other areas of the country.
Porter Airlines announced on Monday that it would institute a temporary fuel surcharge on some flights.
On flights booked with loyalty points through the Canadian airline’s VIPorter redemption program, Porter began charging a $40 peak surcharge for flights within North America and an $86 fee per leg for international flights.
“We want to be transparent about why this change is necessary,” Porter wrote in an email to customers. “Fuel represents the highest cost of airline operations and this surcharge allows us to maintain the number of points required for redemption.”
President Ferdinand Marcos of the Philippines declared a state of “national energy emergency” on Tuesday.
The executive order stated that the war in the Middle East had resulted in “imminent danger posed upon the availability and stability of the country’s energy supply.”
The Philippines also rolled out fuel subsidies for public utility vehicles to help them absorb climbing costs.
Street vendors in New Delhi have switched to electric, coal, wood, and kerosene stoves amid a shortage of LPG gas cylinders.
Amid the shortage of liquefied petroleum gas, which is used across India for everyday cooking, a tea seller on Tank Road in Karol Bagh, New Delhi, was photographed heating up tea using a coal stove on Sunday. Many eateries in the country have had to scale back their menus or close completely.
Some fishing vessels in Thailand have halted operations due to the prohibitively high cost of boat fuel.
About 40% of Thailand’s 9,000 registered fishing vessels have paused operations, a Thai official told the Bangkok Post.
The reduction in fishing is expected to push up seafood costs. Seafood vendors have already raised prices of some items by 5 to 20 baht, or between around 15 and 61 cents, per kilogram, according to The National Fisheries Association of Thailand.
The closure of the Strait of Hormuz has also raised concerns about global fertilizer supply shortages affecting food security and prices.
About one-third of the global seaborne fertilizer trade passes through the Strait of Hormuz, according to a report released by the UN Conference on Trade and Development on March 10.
The report added that the shipping disruption is “raising concerns about ripple effects across global markets.”
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