YAOUNDÉ, Cameroon: The war in the Middle East could cause the “worst industrial crisis in living memory,” the head of the International Chamber of Commerce warned Wednesday.
Skyrocketing crude prices since the start of the US-Israeli war on Iran in late February have raised fears of a global recession, with Tehran in effect choking oil shipments through the strategic Strait of Hormuz.
“The head of the International Energy Agency has warned that the world is facing an energy crisis more severe than the oil shocks of the 1970s,” ICC chief John Denton said.
“From a business perspective, we believe this could yet become the worst industrial crisis in living memory,” he added, speaking on the eve of the meeting of World Trade Organization ministers in Yaounde, Cameroon.
“Not only because of surging energy prices, but because industrial production itself is being disrupted and dislocated by shortages of gas and other essential inputs.”
Denton warned that the situation was already alarming, with Iran’s de facto Hormuz blockade preventing the export of fossil fuels, fertilizers and other goods from the oil-rich Gulf region.
“We are already seeing major companies ... cut output as shortages ripple through energy, chemicals and other critical supply chains,” he said.
“And — let’s be clear — the consequences do not stop at industry. Disruption to trade in agricultural fertilizers now creates a very real risk for the next harvest season ... with farmers across the world, and perhaps most acutely in Africa, facing supply shortages and price increases that may force lower application rates of essential nutrients.
“(This is) a situation that ultimately — and inevitably — will translate into much lower agricultural yields and food security risks later this year,” Denton said.
“That is why it is vital that the international community does everything possible to restore safe passage of commercial shipping through the Gulf.”
