Pellervo Economic Research Institute (PTT) warns that if the conflict in the Middle East continues, it could have serious consequences for food and commodity prices. Global oil and natural gas prices have already sharply risen, disrupting energy and fertilizer markets, which in turn affects food production and delivery processes. The report suggests that prolonged war could lead to broad inflationary pressures on food prices.

The tensions surrounding the Strait of Hormuz, a critical transit route for oil and fertilizer shipments, are causing increases in both oil and fertilizer costs. The rise in oil prices drives up the costs associated with transportation, logistics, agricultural inputs, packaging, processing, and global supply chains. Furthermore, the increase in natural gas prices particularly impacts the cost of nitrogen fertilizers, which are essential for agricultural productivity.

PTT emphasizes that even though natural gas prices are currently elevated, if the conflict worsens or persists, the implications could be severe, making food more expensive and potentially causing widespread economic strain. As such scenarios unfold, consumers may soon face higher prices at stores as inflationary pressures mount within the agriculture sector and supply lines remain unstable.