As of the eighth week of the U.S.-Israeli war on Iran and the Trans-Jordan, economic shocks are hitting worldwide. The impact is made worse by pre-existing locations of economic breakdown resulting from a number of known factors, including the current war economy push in the trans-Atlantic, decades of anti-tech “green” policies, and the now tottering, predatory finance and trade system of the West. Experts emphasize that the impact felt to date is nothing compared to what will happen shortly, because there were still significant amounts of oil and other supplies on ships in transit when the war began, as well as stockpiles in some countries, and those are now running out.
The following are a few indicative updates on the shock waves that have just begun to hit.
World Food Production Falling—Grains
The volume of production of staple grains (wheat, corn, rice) can be seen as a metric of food sufficiency overall, and as of now, the global volume is projected to decline in the next crop cycle, directly from the combined effects of lack of adequate fertilization, fuel, and other necessities for agriculture. A worldwide decline of two percent in the crop season 2026-2027 for “total grains” (wheat, corn and some others) is projected in the monthly “World Market Report” issued April 23 by the International Grains Council, based in London, and operating since 1949. The understated IGC report explained, “Concerns about fertilizer affordability and application decisions have added to uncertainties about the 2026-2027 cropping outlook, including parts of the Southern Hemisphere, where upcoming requirements may not be covered.”
David Laborde, Director of FAO’s Agrifood Economics Division warned on April 13, “We are in an input crisis; we don’t want to make it a catastrophe. The difference depends on the actions we take,” said Laborde. That was 10 days ago. The FAO has prepared “a crop calendar-based prioritization of countries based on when and how much fertilizer they need,” declared FAO Chief Economist Maximo Torero. Laborde calls for nations to reconsider—he says “ponder”—switching to biofuels in this emergency.
Cut Fertilizer, Cut Food
Prices are rising, supplies are falling for all essential chemicals for plant life: nitrogen, phosphorus, potassium, and sulphur. In a recent year, about 115 million metric tons of some type of nitrogenous fertilizer was applied worldwide, but as of now, it will be significantly less. Some 25% of nitrogenous fertilizer has been dependent directly and indirectly on transit through the Strait of Hormuz, now blockaded.
China, the biggest user of nitrogen fertilizer at the level of about 27 million metric tons (mmt)t, is taking strong contingency measures. The next largest user, India, at 21 mmt, is under severe pressure, with normally 20-30% of its urea coming from the Gulf region. The nation is using a combination of imports—whose costs are running 90% higher than pre-Iran war, and as much domestic production as possible. This is restricted since natural gas imports are running below 70% of pre-conflict volume. Urea production is down by dozens of thousands of tons. India’s fertilizer reserve is currently cushioning the shock, but will be depleted.
In the United States, the next largest user, at 12 mmt annually, farmers are facing impossible price rises, and regional shortages. The situation in many other countries is dire. Moreover, some of the leading grain exporting nations face extreme problems.
Argentina, which ranks among the top ten wheat exporters in the world, has urea prices up 100% over the past two months, going from $500 to $1,000 a ton. Now, at wheat planting time, many farmers are considering not putting in a crop at all. In recent times, Argentina imported half of its fertilizer—all types, and of urea (granular), 60% came from three Gulf nations and Turkmenistan. Brazil, the world agriculture power house, has a severe fertilizer crisis.
Africa, with many nations dependent on imports of fertilizer for more than 85% of usage, smallholder farmers have no options, as prices spike and supplies shut down. They face a food crisis this year. The FAO estimates, for example, that a 10% reduction in fertilizer application in Sub-Saharan Africa will result in up to 25% less rice, corn and wheat there, with devastating human consequences.
Ethiopia, which has worked to increase irrigated farmland, has an extreme fertilizer supply crisis. With up to 90% of its fertilizer recently connected to the Gulf state producers, prices have surged nearly 70%, and shortages have hit during the belg planting season (February to May, usually rainy). The positive future is shown by the planned new urea fertilizer production complex to be built in Gode, Ethiopia, by the Dangote Group, matching its one already operating in Nigeria.
World Fuel Shortages, Price Hikes
In recent times, 20 to 30% of petroleum, crude oil, and liquefied natural gas transited the Strait of Hormuz, now blockaded. Waves of price hikes and shortages of the various types of end products are underway, from petroleum, to jet fuel—about 9% of all liquid fuel consumed worldwide, to gasoline (petrol), diesel, LPG (liquefied petroleum gas, for cooking, heating, and vehicles), natural gas and so on. The effect is severe everywhere, but dramatic in the European Union, which has already cut its oil and gas imports from Russia, and shut down many of its coal and nuclear plants under various false eco- and other pretexts. Since Feb. 28, the cost of gas-fueled electricity has gone up more than 50% in the EU.
Slovenia was the first EU nation to ration petrol to individual users, at 50 liters a day, as of late March.
Diesel Prices Soar
In the United States the average price of a gallon of diesel is up about 45% since Feb. 28, straining the truck-dependent transportation system, and farmers as well. The price of gasoline is up some 35% during the two months. Some gas stations are running out of fuel. Refineries geared to one or the other—diesel or gas—cannot switch back and forth. After China, the United States ranks as the second largest oil importer in the world, supplied by Canada, Mexico, Saudi Arabia and some others.
In India, the world’s third largest oil importer, trucks haul nearly 70% of the country’s freight. The government has so far shielded truckers from price hikes, but this may end, pending elections this month, and meantime there has been informal rationing among truckers. An estimated 10% of trucks are out of service, and that could climb fast.
In Europe, truckers have staged protest demonstrations in Ireland, the UK, France, Germany, and Italy, against the rising diesel prices, which have exceeded 33% in two months.
Across Africa, there are extreme repercussions on prices and supply of diesel and on other products from the shutdown of transit through the Hormuz Strait. In South Africa, which imports 70% of its fuel, there are widespread outages at gas stations, as well as price hikes.
Jet Fuel Shortage
Air carriers the world over are taking extreme measures because of the shortage of jet fuel, including cutting thousands of flights, adding per-flight surcharges, raising ticket prices, and other measures. Australia and Asia saw cutbacks starting weeks ago, now European carriers have announced major cutbacks. For example, the Lufthansa Group has cancelled 20,000 flights affecting six of its top European hubs, beginning in May, continuing over the Summer. United Airlines, the U.S. carrier, announced ticket price increases of 15% to 20% for the Summer months.
