Gulf: Hydrocarbon Shipments Down 75% To 90%

(MENAFN- Brazil-Arab News Agency (ANBA)) São Paulo – A report by the United Nations Economic and Social Commission for Western Asia (ESCWA) issued a warning on Thursday (2) about the impact of the war between the United States and Israel and Iran on the energy, water and food systems of Arab countries.

According to the report, this risk is immediate and growing, especially for fragile and conflict-affected countries with limited fiscal space and a strong dependence on food imports.

ESCWA says disruptions in energy trade are the most immediate macroeconomic shock and notes that oil prices rose above USD 112 per barrel due to the near-closure of the Strait of Hormuz. According to the commission, this has been driving inflation, widening fiscal deficits and increasing transport and insurance costs in the region.

The report also warns of risks to water security, noting that nearly 40 million people in Gulf Cooperation Council (GCC) countries rely on desalinated water sourced from the Gulf, making them highly vulnerable to any damage to energy or desalination infrastructure, as well as to marine pollution caused by the conflict.

ESCWA's acting executive secretary, Mourad Wahba, called for urgent and coordinated regional action to safeguard critical supply chains, urging the deployment of early warning systems, the securing of regional strategic reserves, the diversification of trade corridors, and accelerated investment in resilient energy, water and food systems.

The U.N. commission says rising fuel prices, disrupted shipping routes and higher fertilizer costs are likely to further increase food prices and production costs, particularly affecting low-income and vulnerable populations.

This is ESCWA's second assessment of the conflict's impacts. The first said preliminary estimates pointed to regional losses of about USD 63 billion in two weeks, potentially reaching USD 150 billion in a month. The war marked one month this week.

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Hormuz: 20% of energy, 30% of LPG, 50% of sulfur

Translated by Guilherme Miranda

ESCWA

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