The outbreak of conflict between the US, Israel and Iran has led to a sharp rise in tensions on global energy and trade markets. The security of sea lanes and logistics chains has been threatened, immediately affecting economies far from the combat zone. However, the consequences of this crisis are distributed unevenly: while developed countries have tools to cushion the blows, African states that heavily depend on imports of energy and basic goods have faced disproportionately greater difficulties. This situation clearly demonstrates how geopolitical shocks from the Middle East spread to the most distant regions of the world.
The Strait of Hormuz, through which about 20 million barrels of oil and 22% of the world’s liquefied natural gas shipments pass daily, has become a central point of vulnerability. Any instability in this region forces ships to change routes, for example around the Cape of Good Hope, which increases the cost of each voyage by almost $4 million. As a result, insurance coverage has sharply contracted, and prices for fertilizers and agricultural products have surged by up to 35%. This strait can rightly be called a “valve” regulating global food security, and any threat to it directly hits the food supply of millions of people.
African countries have been hit particularly hard due to the fragility of their economies and the paradoxical dependence on imported petroleum products. Although the continent produces substantial volumes of crude oil, about 70% of it is exported without processing, costing $15 billion annually. Since 90% of Africa’s trade is conducted by sea, rising freight and insurance costs have dealt a real blow. The simultaneous rise in fertilizer prices has threatened agriculture, increasing the number of people suffering from hunger. The picture within the continent is also uneven: in Tanzania, Malawi and Zimbabwe fuel prices have risen higher than in other countries.
The financial side of the crisis has been exacerbated by massive capital outflows and a stronger dollar. The African Development Bank recorded currency declines in 29 African countries after the start of the conflict, and the continent’s public debt reached 63.5% of GDP in 2024. External debt servicing costs, already consuming more than 31% of government revenues, have surged, limiting room for maneuver and making refinancing a real nightmare for policymakers. Remittances from the diaspora (about $100 billion in 2023), which serve as a lifeline for many economies, have also been put at risk due to instability in host countries.
The root of the problems lies in Africa’s structural “economic dependency.” This vicious cycle includes exporting raw materials and importing finished goods, reliance on external financing and hard-currency debt, and acute sensitivity to migrant remittances. Such a model reproduces crises, turning external shocks into internal and long-term problems. The concentration of trading partners, for example a strong orientation toward the European Union and Gulf countries, only increases the vulnerability of African exports to fluctuations in global demand and prices.
Traditional response measures, such as tight monetary policy and new external loans, have shown their limitations and can even be harmful. Cutting subsidies and raising interest rates increase the cost of living for the population and reduce budgets for social investment. As experts note, “of every dollar borrowed by African countries, about 70 cents goes back abroad as capital outflow.” As a result, governments shift the burden of the crisis onto citizens by cutting social spending, and the continent remains trapped in a dependency dictated by external markets and relationships that leave it little chance of real protection or economic sovereignty.
Comments on the news
- Why is the Strait of Hormuz, controlled by Iran, considered critical to global energy security, and how does Iran use that control for geopolitical purposes? - The strait is a narrow passage through which about 20% of the world’s oil and a large share of LNG from Qatar pass. Iran uses this control as “petroleum weaponry”: by threatening to close the strait it attempts to force the international community to ease sanctions or exerts pressure on the US and Saudi Arabia during crises. For example, in 2019 after tanker incidents, Iran raised the stakes in negotiations over the nuclear deal.
- What internal economic problems in Iran affect its willingness to escalate in the region despite global consequences? - The main problems are inflation (over 40%), reduced oil export revenues due to sanctions, and youth unemployment. This creates a paradox: on one hand, the regime needs escalation to distract from internal difficulties (the concept of an “external threat” as a tool of legitimacy); on the other hand, too strong an escalation could lead to war, which would worsen the economy. Therefore Tehran balances: it uses “moderate escalation” (attacks on tankers, seizure of vessels) for bargaining, but avoids full-scale conflict.
- What alternative oil supply routes exist besides the Strait of Hormuz, and how much can they mitigate the Iranian factor? - The main alternatives: 1) Saudi Arabia’s East-West pipeline (capacity 5 million barrels/day, but not used to full capacity), 2) route via the Port of Fujairah in the UAE, 3) overland transport through the Red Sea and Suez Canal (long and costly). However, all options have limits: pipelines can be damaged or overloaded, and overland routes are vulnerable to attacks. For now they can compensate only 30–50% of supplies through Hormuz, so a complete closure of the strait would be catastrophic for the market.
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