Only four weeks into the war with Iran, and the economic repercussions will not go as swiftly as they came to the U.S. and global economy. It won’t be just the cost of oil that’s going to impact Americans’ checking accounts — things like fertilizer and even insurance may eventually lead to higher costs at the grocery store.
The “Make America Affordable” promise seems like a distant memory from the administration that trumpeted affordability and lower costs. Americans have spent a year navigating higher grocery bills due in part to Trump’s tariffs and now have additional cost increases to deal with because of U.S.-led involvement in the Iran war.
The United States and Israel launched military strikes against Iran on Feb. 28, marking the start of the conflict the Trump administration has dubbed “Operation Epic Fury.”
As a result of the conflict, which has killed more than 1,500 Iranians according to the nation’s health ministry, Iran has effectively blocked movement through the Strait of Hormuz, causing a global energy crisis and a surge in oil prices.
The 21-mile-wide waterway connects the Persian Gulf to global consumers, passing an estimated 20 million barrels of crude oil and petroleum products daily.
Iran stopped any passage of products and goods through the waterway in late February, halting approximately one-fifth of the world’s oil and LNG supply.
This time last year, the cost of crude oil averaged between $82 to $62 a barrel, according to the U.S. Energy Information Administration. Brent crude oil, a leading global benchmark price for purchasing oil, settled at $112.19 a barrel on March 20 — nearly a 50% increase from last year. Energy experts anticipate additional increases as conflicts escalate.
Americans are noticing rising gas prices already. But higher prices will soon impact more than just daily commutes.
Dionne Mitchell, a director at CSO Yemen, primarily focuses her work on getting food and supplies to people in ongoing conflict areas. Mitchell told HuffPost her role often shows how instability in the Middle East can influence oil prices. She explained that many people often forget that modern food production relies on fuel for tractors on farms and for the trucks transporting produce.
“When our organization calculates aid delivery costs, fuel is one of our biggest considerations,” Mitchell said. “So when fuel gets more expensive, every single step of getting food to a plate costs more.”
To put it in perspective, the increases in fertilizer and fuel costs means it will cost me an additional $100,000 to plant corn this year.
She frequently plans and adjusts for broken supply chains and rising costs on a global scale. “I see global events directly affecting our operations and the people who rely on us. Just one blocked port or a dangerous sea lane can stop our food deliveries for many weeks,” Mitchell added.
For Mitchell, the current Strait of Hormuz closure means “a massive bottleneck for global shipping.” When the cost of oil goes up, and for an extended period of time, farmers and distributors will begin to feel this crunch — it’s an all-too-familiar economic instability they’ve already dealt with since Trump’s tariffs hit the food and farming industry in 2025.
It’s not just oil that passes through the Strait of Hormuz.
What many Americans might not be aware of is that it isn’t only oil that’s sent through the Strait of Hormuz — one-third of globally traded fertilizer ingredients flows through the narrow waterway.
In a public letter to Trump from the American Farm Bureau Federation last week, 54 agriculture groups laid out the challenges facing American farmers and how this new conflict with Iran is impacting them. They detailed how “severe weather, high expenses and global uncertainty” are “squeezing” the farming industry “to the breaking point.”
The recent closure of the strait has not only raised the cost of fuel but also fertilizer prices — adding to the financial strain farmers face and posing significant consequences for the food supply chain in America and around the world.
The Strait of Hormuz carries some 30% of globally traded fertilizers, and Gulf producers are big suppliers of ammonia and urea (key fertilizer ingredients), according to the U.N. Food and Agriculture Organization.
Prices for urea have risen by approximately $80 per ton since the war began, per Reuters. This could mean farmers who buy them via producers that typically use the Strait of Hormuz will have to go elsewhere, have delays on supplies or pay higher costs to find fertilizer, potentially impacting food production and costs.
Tennessee farmer Todd Littleton, who farms 4,000 acres for corn, told MarketWatch he’s already experiencing fallout from the shipping lane’s closure right before planting season. It’s not only the cost in diesel, it’s the “unplanned $50-per-acre increase in the cost of nitrogen,” a critical product for his corn crop fertilizer.
“To put it in perspective, the increases in fertilizer and fuel costs means it will cost me an additional $100,000 to plant corn this year,” he told the outlet.
“We’re looking at every potential avenue to keep the fertilizer costs down as these farmers are going into planting season,” Agriculture Secretary Brooke Rollins told reporters on March 16.
But also added that she had “no big announcements yet, but it is coming.” Rollins claimed most farmers had already secured fertilizer, though around a quarter had not.
Fluctuating insurance rates will also likely lead to higher grocery costs.
There’s another factor affecting costs at the supermarket that might seem invisible to consumers: rising insurance prices due to the instability of the Middle East region and the Strait of Hormuz closure.
The vessels that ship through the Strait of Hormuz each have several forms of insurance to protect the goods being transported. But given the upheaval in Iran and the closure of the waterway, with potential threats targeting any vessels that might ship products, insurers are raising costs. According to Marsh’s ”2026 Global Terrorism Risk Insurance Report” and analysis by international credit ratings and research firm Morningstar DBRS, a recent proposal by the United States government to support insurance for vessels traveling through the Strait of Hormuz may not be enough to rapidly restore commercial navigation in the region. Higher risk means higher insurance costs.
So even if the waterway is reopened, it’s possible that the cost to send ships through it will be higher than before, which will impact farmers buying fertilizer. That, plus higher oil prices, is likely to hit your grocery bill soon enough.