The price of oil rose. Everyone already knows that. What few have stopped to analyze is that the real problem goes much further. Every time there is a conflict in the Middle East, the conversation boils down to a single variable. It is understandable, it is the most visible, the most immediate, the easiest to measure and explain. However, behind the price of the barrel, there is a chain of effects that touches foods, medicines, metals, industries and, therefore, people’s pockets.
To better understand what is happening, it is important to have a simple idea clear. When conflict disrupts the ability to produce something the world uses, prices rise. Economists call that a supply shock. It is not a new phenomenon; We lived it with the pandemic, with the war between Russia and Ukraine, and we are seeing it again today. The important thing is that this type of crashes does not stop there.
If prices rise too much and for too long, families and businesses start spending less. Demand cools. and what It started as a production problem ends up becoming a growth problem. That is precisely the chain that is being activated today in the global economy, and that is worth understanding before it reaches the door of each home.
AND How is this shock transmitted to the economy?? Through various channels.
The Strait of Hormuz
The first channeland the most obvious, is the interruption of trade and energy transportation. The main point affected has been the Strait of Hormuz, one of the most strategic maritime passages in the world.
Approximately a fifth of global oil and liquefied natural gas circulates there. For economies like China, India, Japan, and South Korea, this route is not optional; It is vital. In the first quarter of 2025 alone, China imported about 37% of its oil through that strait.
But staying only with oil is repeating the same mistake from the beginning. Oil is what you see. What you don’t see is just as importantand in some cases, more worrying.
The second channel
What few are commenting on starts with something as basic as what we eat The same disruption in Hormuz is shaking up the global fertilizer market. About a third of the world’s seaborne fertilizer trade passes through that route. The effect is already visible in the prices: ureathe most used fertilizer in the world, went from $484 to more than $750 per ton in a matter of weeks. An increase of 55% in a very short time.
Less fertilizer means smaller yields, and smaller yields mean less corn, less wheat, less ricethe grains that feed much of the world. When supply falls, but demand remains the same, the result is something we all know well: Higher prices in the supermarket. And not only will the cost of food go up; also that of transportation, which will make everything that reaches our table even more expensive.
There the crash stops being distant news. When spending on food goes up, disposable income goes down. Families adjust. They consume less in other areas. The problem that began in a strait thousands of kilometers away ends up living inside each home.
Inputs from key industries
The impact does not stop at the basic basket. There is a third channel which should be noted.
The conflict is hitting inputs that support key industries. Polyethylene, the most used plastic in the world, present in packaging, pipes and medical products, depends 15% on production in the Middle East. Aluminum, essential for the automotive industry, construction and electronic devices, faces similar pressures: about 9% of its global production comes from this region. In addition, there are reports of direct attacks on plants producing polyethylene, urea, natural gas and aluminum.
As if this were not enough, we have the case of helium. It is not a merely decorative gas. It is essential for MRI equipment in hospitals and for manufacturing semiconductorsthe chips that power everything from a phone to a car. About a quarter of global supply could be affected.
When these pieces come together, the picture changes completely. We are no longer just talking about an energy problem. We are talking about a disruption that simultaneously affects health, agriculture, industry, logistics and technology. In simple words, the problem goes beyond oil.
And if all of the above were not enough, there is a greater risk that encompasses everything: global trade.
If the conflict continues, Iran has threatened to go further, block the Bab el-Mandeb Strait, the gateway to the Suez Canalwhere It transits 25% of world trade. A blockade there would force routes around Africa to be diverted, skyrocketing logistics costs and delivery times significantly. In other words, the problem would no longer be just one of prices. It would change the way the world trades.
What does all this mean for 2026?
In 2025, despite the noise of tariffs and trade tensions, the world economy showed the ability to adapt. Companies adjusted their supply chains; some diversified markets and learned to operate in uncertainty. But 2026 appears more complex. This is not a new temporary scare, but a shock with the capacity to simultaneously affect prices, trade, logistics costs and confidence of consumers and investors.
The environment bears similarities to that of 2022, when the war between Russia and Ukraine broke out. And, as then, not all countries face this blow from the same position: some benefit, others have room to absorb it and others simply do not have it. It is worth remembering that, in that episode, oil reached close to $125 per barrel, above the levels we have seen until now and, even so, the world moved forward. The effects turned out to be less severe than analysts had predicted.
Recently, the United States and Iran They agreed to a 15-day trucenews that brought momentary relief to the markets. But a truce is not a peace, and 15 days do not resolve the root causes of a conflict that has been brewing for years. There is still no clarity about the magnitude of the damage to oil infrastructure or to the industries that produce agrochemicals, plastics and gas, nor about how much longer the conflict will last. The price of oil may go down and the markets may calm down, but The chain of effects we have described will not disappear with a temporary agreement.
dortiz@cefsa.cr
Luis Liberman and Daniel Ortiz are economists.
