It's not just gasoline. Iran war could drive prices higher for many products.
Summary
The war involving Iran is causing higher oil prices, which in turn raises the cost of many everyday products. This is because oil is not only used for fuel but also for making materials found in thousands of consumer goods, from toys to clothes to medical equipment.Key Facts
- Many products like polyester toys, clothing, and household items rely on petrochemicals made from oil.
- The conflict has already led to a 10%-15% increase in material costs for some companies.
- Over 6,000 consumer products, including keyboards, lipsticks, and shoes, depend on petrochemicals.
- The war is also affecting supplies of helium and aluminum, important for technology and medical devices.
- Gasoline and jet fuel prices have risen, leading to higher travel costs and shipping fees.
- Oil is transformed into chemicals that create plastics, synthetic fibers, and packaging materials.
- Higher oil costs could cause manufacturers to raise product prices if the conflict lasts several more months.
- Materials make up a large part of production costs, for example about 27%-30% for making a shirt.
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