Oil Shortage! Ongoing Middle East Conflict Spreads Crisis to Other Sectors

BlockBeats news, April 4, according to a CNN report, as the Middle East conflict enters its second month, the crisis of crude oil shortages is at risk of evolving into an even worse situation—almost everything will face shortages. The Middle East conflict has severely restricted the transportation of oil and natural gas through the Strait of Hormuz, resulting in about one fifth of global supply being cut.

This disruption has not only pushed up fuel prices but also squeezed the supply of petrochemical products needed for the manufacture of everyday items like shoes, clothing, and plastic bags. As prices for materials such as plastics, rubber, and polyester rise, this pressure is spreading into every corner of the consumer market.

Currently, the impact is most pronounced in Asia, a region with more than half of the world's manufacturing and a heavy reliance on imported oil and other commodities. Dan Martin, co-head of commercial intelligence at Deloitte Tohmatsu Consulting, said this will spread to all goods very, very quickly, such as beer, noodles, chips, toys, and cosmetics, because plastic bottle caps, shipping pallets, snack packaging bags, and containers are becoming increasingly difficult to source.

Martin added that adhesives used for footwear and furniture, industrial lubricants for machinery, and solvents required for paint and cleaning processes also all depend on petroleum-derived products.