Africa reeling from economic impact of Iran war

Rising Oil Prices from Iran War Create Economic Strain Across Africa

Lagos taxi driver Adegbola Isaac felt the immediate impact when fuel prices in Nigeria jumped to 1,350 naira ($0.99) per liter last weekend, a nearly 35% increase since the outbreak of hostilities between Israel and Iran. The steep rise has virtually eliminated his daily profits.

“It is hitting hard,” Isaac told The Associated Press.

Millions across Africa are experiencing similar economic hardships from a conflict taking place thousands of miles away. The February 28 joint U.S.-Israeli strikes on Iran and subsequent closure of shipping routes through the Strait of Hormuz have triggered global fuel price increases, with African nations bearing a disproportionate burden.

For many Africans, this latest price shock compounds existing economic challenges in some of the world’s most vulnerable households. The continent finds itself once again suffering collateral damage from global crises it played no part in creating.

This pattern has become distressingly familiar. From the COVID-19 pandemic to the Ukraine war and now the Middle East conflict, Africa—with a population rivaling China and India—has repeatedly absorbed painful economic aftershocks as global powers compete for critical resources like fuel and fertilizer.

The impact has been swift and severe. With most African countries being net importers of refined petroleum products, rising retail fuel prices have triggered cascading increases in the costs of essential goods and services across the continent.

Economic analysts note that African economies remain critically integrated into global markets but lack the resilience to withstand international shocks due to their dependence on major economies. A 2025 report by UN Trade and Development (UNCTAD) describes Africa as “the epicenter of overlapping global crises,” noting that more than half of the continent’s imports and exports are tied to just five non-African countries.

The fuel supply vulnerabilities vary by country but are widespread. Kenya sources all its fuel from the Middle East, particularly the United Arab Emirates, with 20% of the country’s outlets already reporting shortages. Uganda’s fuel reserves were initially projected to last only a few weeks.

South Africa depends heavily on Saudi Arabian oil, while Nigeria, despite being Africa’s largest oil producer, lacks sufficient refinery capacity and relies on importing refined products from Europe.

The economic pressure is driving public unrest in some regions. In Zimbabwe, healthcare workers have protested for wage increases as living costs spike. The government’s plan to increase ethanol blending in fuel from 5% to 20% raises both environmental and vehicle maintenance concerns.

“I now avoid going into town during peak hours because the fares are too high,” said Washington Nyakarize, an informal cellphone trader in Harare. “If I go later, the charge is a bit lower, but I lose business, because most customers come early in the morning.”

In South Africa, diesel-dependent industries began panic buying despite government assurances about untapped strategic reserves and diversified supply routes.

The impact extends beyond just fuel. Fertilizer access across Africa, including in conflict-affected countries like Sudan and Somalia, is expected to be severely disrupted, according to UNCTAD. Kenya’s vital flower industry reports weekly losses of up to $1.4 million since the Iran war began, citing declining demand and shipping disruptions.

“If the conflict persists for another month or two, honestly, we’re going to be in unknown terrain that no one can really predict, and we just have to wait and see,” said Zainab Usman, a senior research scholar at the New York-based Center on Global Energy Policy.

African governments are scrambling to secure alternative supply routes. Bloomberg reported that several countries including South Africa, Kenya and Ghana have approached Nigeria’s Dangote Refinery for fuel deals. The refinery recently completed sales of 12 shipments of refined petroleum products to several African nations, including Ivory Coast, Cameroon, Tanzania, Ghana and Togo—a significant development since reaching full capacity earlier this year.

Energy experts caution that while the Dangote refinery represents a potential regional solution, its capacity to meet growing continental demand depends on steady crude oil supplies and planned expansion projects.

“As long as there is a steady supply of crude oil, the refinery has the capacity to meet some of the needs from across the continent,” according to Olufola Wusu, a Lagos-based oil and gas expert who helped review Nigeria’s national gas policy.

As the conflict in the Middle East continues with no immediate resolution in sight, African economies remain highly vulnerable to further price shocks and supply disruptions, highlighting the continent’s persistent economic exposure to geopolitical events beyond its control.