The escalation of tensions in the Middle East since late February 2026 is creating a devastating domino effect on supply chains across the Asia-Pacific region. With logistics costs rising by 20% and maritime insurance premiums soaring past the 50% threshold, the region is facing inflationary pressure and a serious risk of essential supply chain disruptions.

The Hormuz "bottleneck" and operational cost shocks

The Strait of Hormuz, the gateway for 20% of the world's oil, has become the epicenter of the crisis. Reduced traffic through this passage has pushed crude oil prices above $100 per barrel, directly increasing transport and electricity costs in import-dependent nations such as Pakistan, Sri Lanka, and the Philippines.

• Maritime insurance: War risk premiums have increased by 25% to 50%, leading to a decline in vessel traffic and isolating landlocked countries like Afghanistan.
• Inland transport: In Pakistan, the prices of gasoline and diesel have risen by 24% and 22% respectively, placing immense pressure on distribution systems.

Disruptions in agricultural and food supply chains

Beyond energy, the Strait of Hormuz is the transit route for one-third of the world's fertilizer raw materials. Disruptions to ammonia and nitrogen shipments are directly threatening crop seasons in agricultural nations.

• In Afghanistan, the cost of the Food Security Cluster's food basket has increased by 6.8%.
• In Myanmar, fuel shortages (90% of which is imported) and port labor shortages are paralyzing farming capabilities.

Humanitarian logistics under besieged pressure

Relief operations are becoming more expensive and difficult than ever due to airspace restrictions and maritime uncertainty. Approximately 50% of humanitarian cargo is facing the risk of "pipeline breaks." Carriers are forced to seek costly alternative routes and alter procurement methods to sustain operations.

Emergency responses and austerity measures

Many governments in Asia have had to activate unprecedented traffic and energy control measures:

• Vietnam: Reduced fuel import taxes and issued warnings regarding the risk of aviation fuel shortages.
• Thailand & Philippines: Implemented Work From Home (WFH) policies or four-day work weeks to reduce energy demand.
• Laos & Cambodia: Banned the sale of fuel into large containers and required real-time inventory reporting to prevent speculation.

The combination of high shipping costs and border disruptions is putting terrific pressure on household purchasing power. Stakeholders—from transport companies to humanitarian organizations—all face the challenge of rising operational costs while financial resources are tightening.

The world faces a dire scenario if the crisis persists until mid-2026: an additional 9.1 million people in Asia are projected to fall into urgent food insecurity. Diversifying logistics routes and implementing energy self-sufficiency measures will be the key for nations to weather this supply chain "storm."

Source: https://www.unocha.org/publications/report/afghanistan/asia-and-pacific-humanitarian-impact-middle-east-escalation-3-april-2026 

Share this article