The direct distance between Iran and Jamaica of over 7,000 miles is not that far when war intervenes. We are already experiencing some fall out, and things will get worse if it continues. Consumers must, therefore, take action to secure their financial position.
The armed conflict began when United States and Israeli forces launched a large-scale military action, which targeted military infrastructure, leadership and strategic sites in Iran on February 28, 2026. This conflict has disrupted global shipping, particularly the flow of oil through the Strait of Hormuz, through which 20 per cent of the world’s oil normally flows.
The oil market, trade and prices are not all that have been affected. The supply of food, fertilisers and building materials are among the commodities that have been affected – not by prices declining, but by them increasing. The prices of other products and some services have already begun to increase as a result of the ripple effect of the higher price of oil in particular.
Higher gas prices trigger higher prices for the electricity used in homes and business places, as well as for the transportation of people and goods – leading to higher prices for food and consumer goods, for example. Add to that the fact that the conflict adds to the cost of transporting goods from abroad, and that higher fertiliser prices add to the cost of producing agricultural produce. This seems to be an incubator for higher inflation and an increase in the cost of living.
Fortunately, so far, the output of vegetables in Jamaica is recovering strongly from the ravages of Hurricane Melissa, thus causing prices to fall.
The longer the conflict lasts, the deeper the challenges for consumers, but, even if it ends soon, the negative effects of the impact of the war cannot be expected to end immediately. Some will persist longer than others, and may not even be fully reversed. The sooner it ends, the better, for as it becomes more protracted, the higher the risk of inflation increasing, and with it the possibility of higher interest rates.
The warnings are out: the taxi operators are shouting that fares will increase; like other operators of motor vehicles, they are feeling the unrelenting increase of gas prices at the pumps. Granted, even without the current development, they would feel justified in increasing fares. The Jamaica Public Service Company Ltd – the light and power supplier – has been warning its customers too, just that it has taken the approach of telling them to conserve on their use of electricity to dampen the increase in their bills.
This is a crisis that many households can use to put their financial houses in order by reordering their consumption, savings and investments. Those that are in order can use the new situation to build a firmer foundation and build stronger walls to protect any serious fallout in their position.
Budgets are spending plans, but there is nothing which says they cannot be adjusted; they must reflect the present reality, meaning it will be necessary to make adjustments as the situation requires. Food and electricity are the items which tend to be most volatile, and they can wreck a budget. There are two ways to give them the important place they deserve in a budget: maintain their consumption at the current levels and pay the increased cost by reducing spending on other areas, or keep the spending at about the same dollar figure by reducing consumption.
The cost of electricity can be controlled by switching to the more efficient LED bulbs, opening refrigerators less frequently, washing full loads in cold water, keeping appliances in good working order, switching off lights and unplugging electronics when not in use, and using natural light when possible.
And let us not forget petrol. Keep expenditure down by using less per trip by using routes that flow well, by travelling when the roads are not so crowded, cutting down on idling, ensuring vehicles are in good working condition, cutting down on the frequency of trips and stops, as well as on speeding and rapid acceleration – in other words, changing behaviour.
Food expenses can be controlled by making and sticking to a shopping list, taking advantage of specials at supermarkets, buying in bulk as much as feasible, buying directly from farmers when possible, and minimising waste by checking the fridge and pantry first to use existing stock, and making use of the freezer to preserve leftovers and food cooked in bulk for future use.
While there may be strong justification to spend more on maintaining a reasonable standard of life, there is still the need to save and invest. Let them remain as priority items in the budget so that resources can be maintained for the future, for life does not consist of today only. Bear in mind that there are dreams to be fulfilled and plans to make tomorrow better.
As for the war in Iran, this too shall pass. Wars do not often come with a warning, and they do not have to happen near home to have a profound financial impact. In a sense, they are emergencies. Being prepared for emergencies and being willing to adjust as necessary can make the difference between survival and utter ruin.
Oran A. Hall, author of Understanding Investments and principal author of The Handbook of Personal Financial Planning, offers personal financial planning advice and counsel. Email: finviser.jm@gmail.com
