A conflict the world simply cannot afford

A fragile ceasefire may have quieted the skies, but the crisis is far from over.
As tensions persist between the United States, Israel and Iran, the conflict has shifted from open confrontation to a high-stakes standoff over the Strait of Hormuz — one of the world’s most critical economic lifelines.
What began as a regional war now threatens to trigger far-reaching global consequences.
The conflict has crossed the 65-day mark. While direct military exchanges have eased, a volatile war of statements and strategic pressure has taken centre stage. At the heart of it lies the Strait of Hormuz, a narrow maritime corridor through which a significant share of the world’s energy supplies flows.
Global leadership must move beyond brinkmanship. Every day this disruption continues, the risk of a wider economic and humanitarian crisis deepens.
The human cost has already been severe. Thousands of lives have been lost across Iran, Lebanon, Israel and parts of the GCC. Yet the ripple effects are now reaching millions far removed from the frontlines. By leveraging energy supply routes, the conflict risks holding the global economy — and its most vulnerable populations — hostage to inflation, food insecurity and unemployment.
The warnings are stark. The International Monetary Fund (IMF) has already cut global growth forecasts from 3.4 per cent to 3.1 per cent. If disruptions to oil and gas flows persist, growth could fall to 2 per cent, while inflation may rise to 6 per cent. Such a scenario would deepen poverty and intensify the cost-of-living crisis, particularly in energy-importing and low-income nations.
An equally alarming, yet less visible, crisis is unfolding in agriculture. The Strait of Hormuz is a key route for around 30 per cent of global fertiliser trade and 20 per cent of liquefied natural gas — essential for producing nitrogen fertilisers. Any prolonged disruption could severely impact crop yields, with some estimates warning of drastic reductions in staple production, translating into billions of meals lost each week.
For import-dependent nations, this poses a direct threat to food security.
Even with oil prices at $80 per barrel, central banks may be forced into tighter monetary policies, slowing recovery. Every sustained $10 increase in oil prices adds roughly 0.2 percentage points to global inflation, affecting transport, manufacturing and food supply chains.
Even major economies such as China, Japan and those in Europe are feeling the strain. The current ceasefire offers only a narrow window for diplomacy.
The IMF has cautioned that disruption in the Strait of Hormuz is not a strategic advantage but a ticking time bomb. Leaders must prioritise restoring trade flows and protecting global supply chains over geopolitical posturing.
Encouragingly, there are tentative signs of diplomatic movement. Iran has indicated it received a response from the United States to its latest peace proposal.
Tehran’s 14-point plan calls for the withdrawal of US forces from areas near its borders, an end to naval blockades on Iranian ports, and a halt to hostilities — including Israel’s offensive operations in Lebanon.
It also proposes reaching a comprehensive agreement within 30 days, urging all sides to focus on ending the war rather than prolonging a fragile ceasefire.
Iran continues to insist that its nuclear programme is for peaceful purposes, despite concerns over its uranium enrichment levels.
Meanwhile, US President Donald Trump has stated that Washington would assist vessels stranded in the Strait of Hormuz, warning that any interference with maritime movement would be dealt with 'forcefully.'
Since the outbreak of hostilities in February, Iran has significantly restricted traffic through the strait, while the United States has maintained pressure through naval measures targeting Iranian ports.