Country-level analysis: Iran War increasing global poverty and food insecurity
The economic impacts flowing from the closure of the Strait of Hormuz continue to reverberate, raising concerns across developing countries facing spiking global fuel and fertilizer prices
- food prices
- conflicts
- poverty
- food security
- Iran war
By James Thurlow and Eleanor JonesJune 16, 2026
Key takeaways
- Developing countries are highly exposed to impacts from the closure of the Strait of Hormuz, IFPRI economic modeling shows.
- Poverty and food insecurity rise modestly in percentage terms, but absolute numbers show a significant impact, with about 20 million more people in poverty and 2.5 million more facing undernourishment.
- Broader economic impacts are limited but uneven. GDP declines are generally small, but agriculture and supply chains face stronger pressures.
The economic impacts flowing from the closure of the Strait of Hormuz continue to reverberate, raising concerns across developing countries facing spiking global fuel and fertilizer prices. New economywide modeling conducted by IFPRI shows that high prices could increase global food insecurity and push more than 20 million into poverty across 20 developing countries.
High exposure to global price shocks
In general, developing countries rely heavily on imported fertilizer and fuel and thus are highly exposed to changes in the global market prices of those items (Figure 1). The Iran war has disrupted supplies originating from or shipped through the Persian Gulf region, a major producer of both fuel and fertilizer, driving prices up. Fuel import dependence exceeds 90% in many developing countries, while fertilizer imports dominate supply across much of Africa and Asia. These dependencies are creating growing economic burdens. When import prices rise by more than export prices, foreign exchange revenue falls and domestic prices increase.
Even oil-exporting countries such as Ghana and Nigeria face challenges. While they stand to earn more from higher oil prices, it usually takes time for oil revenues to filter through domestic economies and benefit populations. At the same time, both Ghana and Nigeria import refined petroleum, despite exporting crude oil, and both import most of their fertilizers.