World Bank warns Middle East conflict driving up energy, fertilizer prices

2026-03-26 - 20:00

World Bank Group announced on Thursday it is working with governments and the private sector to address challenges arising from the Middle East conflict as shipping route disruptions and rising costs hit emerging markets. The group is closely monitoring global market developments and maintaining direct contact with the most affected client countries to understand the situation on the ground, according to a statement. Price surges Supply risks are spreading from energy into fertilizers and other critical agricultural inputs, while crude oil prices increased by nearly 40% between February and March. The price of liquefied natural gas shipments to Asia rose by almost two-thirds, and nitrogen-based fertilizer prices increased by nearly 50% in March, the statement noted. Response readiness The organization is ready to respond at scale by combining immediate financial relief with policy expertise and private sector support for the recovery of jobs and growth. The group aims to deliver immediate relief by leveraging its active portfolio, crisis response toolkit, and pre-arranged financing facilities for governments, firms, and households. Private sector support Through its private sector arms, the World Bank Group will provide firms with essential liquidity, trade finance, and working capital to underpin recovery. The statement underscores the institution's concern that the conflict's economic ripple effects are extending beyond energy markets into broader supply chains. Conflict context The Strait of Hormuz has been effectively disrupted since early March following the US-Israeli offensive on Iran that began Feb. 28. Around 20 million barrels of oil normally pass through the waterway daily, and its closure has contributed to a 40% spike in crude prices, with Brent recently trading above $116 per barrel. Approximately 1,900 commercial vessels remain stranded in the region, including tankers carrying around 190 million barrels of crude oil.