KARACHI March 19, 2026 : The Exchange Companies Association of Pakistan (ECAP) has raised a red flag over the escalating global conflict involving Iran, warning that the effective closure of the Strait of Hormuz has pushed global oil prices to dangerous levels and triggered a looming crisis in international food security.
Supply Chain Disruptions
In a statement issued on Thursday, ECAP Chairman Malik Muhammad Bostan highlighted that the suspension of traffic through the strategic maritime chokepoint has severely crippled the fertilizer supply chain.
“The disruption of this route is not merely an energy crisis; it is a direct threat to global agriculture,” Mr. Bostan stated. He noted that the Gulf region is a primary supplier of urea and other essential fertilizers to major economies, including China, the US, Australia, and Indonesia. With the planting season underway in the Northern Hemisphere, a shortage of nutrients could lead to significantly lower yields for staple crops such as wheat, rice, corn, and soybeans.
Impact on Pakistan
Addressing the domestic impact, the ECAP Chairman warned that a prolonged blockade could triple Pakistan’s oil import bill and drive national inflation toward the 15%–17% range.
However, he lauded the government’s proactive stance and the role of the Pakistan National Shipping Corporation (PNSC) in maintaining the country’s “energy artery” during the regional maritime tension. He urged Pakistani importers and exporters to prioritize national shipping services to reduce reliance on foreign carriers and bolster maritime self-sufficiency.
The Fertilizer ‘Shock’
The statement detailed a worsening situation in the fertilizer sector:
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Production Halts: Major regional producers, including QatarEnergy, have reportedly scaled back or halted operations at massive urea plants due to gas supply interruptions and shipping risks.
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Price Surges: Urea prices have already jumped by 40% to 50%, with the US facing a supply deficit of nearly 30%.
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Global Shortages: As regional factories shut down, the shortage is expected to manifest in higher global food prices and potential scarcity in vulnerable nations.
Geopolitical Outlook
Mr. Bostan remarked that the current conflict has underscored the risks posed by regional instability to global peace. He observed that US public opinion appears increasingly wary of further escalation, with growing domestic pressure on the Trump administration to seek a ceasefire. He further noted that the crisis has paradoxically allowed Iran to demonstrate its strategic endurance and “establish its presence” as a pivotal regional power.
Concluding his statement, the ECAP chief called for immediate diplomatic efforts to end the Iran-US-Israel hostilities, while urging the Pakistani government to implement robust contingency plans to shield the economy from further external energy shocks.
