What the U.S., Israel, and Iran Conflict Means for Global and African Supply Chains

The escalating confrontation involving the United States, Israel, and Iran represents one of the most significant geopolitical risks to global supply chains since the COVID-19 pandemic and the Russia- Ukraine war. Unlike many regional conflicts, this crisis directly threatens the physical corridors through which a substantial share of the world’s energy, shipping, and trade flows move.

Three of the world’s most critical logistics chokepoints—the Strait of Hormuz, the Bab el-Mandeb Strait, and the Suez Canal corridor—sit within the potential theatre of escalation. These corridors collectively carry:

• nearly 20% of the global oil supply

• about 20% of the global LNG trade

• approximately 12–15% of global merchandise trade

Disruptions to these arteries are transmitting shocks across global energy markets, maritime shipping networks, aviation corridors, fertilizer supply chains, and industrial production systems.

Early manifestations of disruption already include suspension or rerouting of major shipping routes, increased war-risk insurance premiums for vessels, restricted airspace across parts of the Middle East, and volatility in global energy markets.

If the conflict escalates or persists, the consequences could include oil prices exceeding $120–$150 per barrel, significant increases in LNG prices, major increases in freight costs, fertilizer supply disruptions affecting global agriculture, and renewed inflationary pressure across many economies.

For African economies, including Nigeria, the implications extend beyond energy markets. Rising shipping costs, fertilizer shortages, and supply delays could affect food security, industrial production, and macroeconomic stability.

At the same time, the crisis highlights an important structural shift in the global economy: supply chain resilience is now a strategic capability rather than simply an operational concern.

Business leaders and policymakers should therefore view the present disruption not only as a short- term shock but also as a signal that global supply chains are entering an era of persistent geopolitical volatility.

Three strategic responses are essential:

First, organizations must develop visibility into supply chain vulnerabilities, particularly those linked to critical logistics corridors and energy inputs.

Second, firms should diversify logistics routes and supplier networks to reduce dependence on a small number of geopolitical hotspots.

Third, governments and industry leaders must accelerate investments in regional supply chains, energy infrastructure, and logistics resilience.

For Nigeria and Africa more broadly, the crisis also underscores the strategic importance of expanding domestic refining capacity, strengthening regional trade under AfCFTA, investing in fertilizer production and food systems, and building resilient logistics infrastructure. Organizations that proactively redesign supply chains for resilience will not only manage current disruptions more effectively but also be better positioned to compete in a world where geopolitical shocks are increasingly common.

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