Summary
The conflict in Iran has disrupted shipping through the Strait of Hormuz, leading to a spike in oil prices and a significant shortage of fertiliser. This shortage could trigger a global food crisis, as key agricultural countries rely heavily on fertilisers from this region for their crops. Urea prices have surged, causing concerns about food production during a crucial planting season.
Key Facts
- The Strait of Hormuz is closed, impacting 20% of the global oil and gas transport.
- Iran's closure of the Strait has pushed oil prices above $100 per barrel.
- Urea, a crucial fertiliser, is heavily exported from the Gulf, with 46% of the global supply originating there.
- Fertiliser shortages are heightened as plants in Qatar and other regions cut or halt production.
- Urea prices from the Middle East rose by 40%, now at over $700 per metric tonne.
- Asia depends on the Gulf for a significant portion of its urea, sulphur, and ammonia supply.
- Brazil relies heavily on fertiliser imports, half of which pass through the Strait.
- The disruption is coinciding with the sowing season, crucial for food production.
