The Ethiopian government has warned that escalating tensions between Iran and Western powers, alongside maritime transport disruptions around the Strait of Hormuz, are exerting severe pressure on global fuel and fertilizer markets. This crisis poses a critical threat to food security and overall macroeconomic stability, particularly in import-dependent, developing nations like Ethiopia.
Speaking at a high-level session during the Global Partnerships Conference in London on May 20, 2026, Finance Minister Ahmed Shide disclosed that soaring fuel prices and fertilizer supply disruptions are now posing major obstacles to the country’s ongoing main “Meher” cropping and planting season.
Detailing the agricultural vulnerabilities and the cascading fertilizer crisis, Ahmed explained that the instability in the Strait of Hormuz is driving up costs across transport, irrigation, mechanization, agro-processing, and food distribution. This systemic shock has placed an incredibly heavy burden on Ethiopia’s trade balance.
The Ethiopian Embassy in London quoted the minister as saying that fertilizer shortages and delivery delays—directly linked to shipping bottlenecks, skyrocketing insurance premiums, and global market volatility—threaten to compromise agricultural productivity and rural livelihoods.
The minister further cautioned that reduced fertilizer availability and mounting cultivation costs could weaken rural economies and intensify food insecurity in nations already struggling with climate shocks, debt distress, inflationary pressures, and humanitarian challenges, ultimately risking a reversal of hard-won development gains in vulnerable economies.
Consequently, Ahmed called for robust international solidarity, urging development partners and international financial institutions to provide emergency financing for fuel and fertilizer imports, concessional credit support, and targeted assistance for smallholder farmers. For long-term resilience against volatile global markets, he emphasized the critical need to aggressively strengthen regional supply chains, storage infrastructure, and logistics networks.
This international warning comes at a time when Ethiopia is already grappling with severe domestic fuel shortages and rising energy costs tied directly to Middle East instability. Because the country relies entirely on imported fuel, recent supply chain disruptions—including delays along Gulf shipping routes and diminished inflows from Kuwait—have forced the country to secure temporary arrangements at a significantly higher cost.
Even though government officials insist that supply lines have normalized, drivers across parts of the Oromia regional state, particularly in East Shewa and Borana zones, report spending days stranded in fuel lines. Public transport operators working the Awash-Adama route note being stranded for days due to diesel shortages, while residents in Batu and Yabello say the disruptions to freight transport are heavily blocking the distribution of essential commodities.
Amid these persistent supply shocks, the government implemented its second fuel price hike in less than a month on May 6, 2026, without a formal public announcement.
Under the revised rates circulated to fueling stations by the Ministry of Trade and Regional Integration, gasoline prices rose from 142.41 Birr to 167.50 Birr per liter, while diesel jumped from 163.09 Birr to 180.46 Birr per liter, alongside sharp increases for kerosene and jet fuel. This acute supply squeeze stems back to late March 2026, when more than 180,000 metric tons of fuel failed to enter the country due to regional conflict.
At the time, Trade and Regional Integration Minister Kassahun Gofe disclosed that daily diesel supply had plummeted from 9.2 million liters to just 4.5 million liters, forcing the state to introduce emergency rationing and distribution measures.
