What the war in the Near East mean for African economies

Shockwaves from the attacks on Iran: What they mean for African economies

I think the most significant consequence of an energy crisis in Africa will be the rise in fuel costs. With rising fuel costs, food prices also rise, and with them, inflation. The military strikes against Iran are unsettling global markets and fueling concerns that African countries could soon face increasing cost pressures in key sectors. Could this rapidly developing crisis fundamentally alter the continent's economic landscape? Many African economies are already burdened by global inflation and currency fluctuations, which act as an accelerant for existing crises in the Middle East. The effects can be divided into three core areas: 1. The energy and inflation shock For the majority of African states, which are net importers of petroleum products, the price increase on world markets is devastating. Since the price of oil has risen dramatically due to instability in the Strait of Hormuz (in some cases exceeding USD 80 per barrel), fuel and transportation costs are increasing immediately. Higher transportation costs are directly leading to rising prices for basic foodstuffs in countries like Kenya and Ethiopia. Inflation, which many central banks had only just managed to stabilize, is once again threatening to spiral out of control. To pay for the more expensive oil imports, countries must spend more foreign currency (especially US dollars), which further weakens the value of local currencies against the dollar. 2. Winners and Losers Among Producers The impact depends heavily on the economic structure of each country. Oil-producing nations like Nigeria, Angola, and Libya could theoretically benefit from the higher global market prices. Their export revenues are increasing, filling their state coffers. Despite its oil wealth, Nigeria often suffers simultaneously because, lacking its own refining capacity, it has to import expensive fuels. Profits from crude oil exports are thus partially offset by increased import costs for gasoline. 3. Logistics and the "Cape Loop" The threat to shipping lanes in the Red Sea and the Persian Gulf has transformed global logistics. As ships avoid the Strait of Hormuz and the Red Sea, the sea route around the Cape of Good Hope (South Africa) is once again becoming the central route. South African ports such as Durban and Cape Town, as well as ports in Namibia and Mauritius, are experiencing increased demand for fuel and logistics services. This detour extends delivery times for imported goods to Africa by weeks and increases freight rates, further fueling the overall inflation rate on the continent. The African Union (AU) warned as early as the end of February 2026 of a massive strain on economic resilience, particularly in countries already grappling with internal conflicts.