Photo: depositphotos
Prices for hundreds of goods worldwide are rising.
The war involving the United States and Israel against Iran, which began in late February 2026, has turned into a major economic shock for global corporations. Companies across sectors—from consumer goods to aviation and mining—are warning of rising production costs, supply chain disruptions, and declining consumer confidence.
According to Reuters, at least 21 companies have already withdrawn or downgraded their financial forecasts since the start of the war, 32 have announced upcoming price increases, and 31 have warned of overall financial losses linked to the conflict.
Strait of Hormuz at the center of the crisis
At the heart of the economic turmoil is the Strait of Hormuz, a narrow sea route between Iran and Oman through which around 20% of global oil and liquefied natural gas (LNG) consumption has historically passed.
LNG—natural gas cooled into liquid form for maritime transport—heats homes and powers electricity for millions of households, especially in Europe. Any disruption in the strait immediately impacts fuel, electricity, and utility prices worldwide.
How long the conflict lasts—and whether shipping can be fully restored—will determine how far the wave of price increases spreads.
First signals from business
Dutch company AkzoNobel, producer of Dulux paints and specialized coatings, was among the first to quantify the impact. CEO Greg Poux-Guillaume said that disruptions in the Strait of Hormuz could increase the company’s raw material basket costs by “high teens,” meaning roughly 17–19%.
The full impact is expected over the next two quarters, through the end of 2026. The company is partially offsetting costs by raising prices and optimizing expenses, leveraging strong brand power.
What else is getting more expensive
- Baby food
French food giant Danone reported slower sales growth in Q1 2026 due to supply disruptions and product recalls in Europe. - Industrial components and electronics
U.S.-based TE Connectivity said it may pass rising freight and oil-related costs onto customers, including higher prices for resins used in manufacturing. - Elevators
Otis Worldwide reported declining sales of new equipment due to supply delays and tariff pressures. - Soap and hygiene products
UK-based Reckitt warned of margin pressure due to high oil prices. Its shares dropped to levels last seen in October 2024.
Aviation and tourism
The tourism sector is under particular strain. Rising jet fuel prices are forcing airlines and tour operators to increase fares, introduce fuel surcharges, or even ground aircraft, while geopolitical tensions dampen travel demand.
- TUI Group lowered its annual operating profit forecast and suspended revenue guidance.
- United Airlines also reported weaker demand and projected earnings below Wall Street expectations for both Q2 and full-year 2026.
Mining sector
Australian mining company South32 reported rising freight and raw material costs. While there is no diesel shortage yet, the situation remains under close monitoring.
GE Aerospace and 3M
Even companies with strong order books face uncertainty:
- GE Aerospace said it would have raised its annual outlook if not for current geopolitical uncertainty.
- 3M warned that higher oil prices could increase its product costs by about 50 basis points (0.5%).
What’s next?
Analysts are watching whether companies can absorb the shock or will be forced to raise prices further or cut forecasts.
“The longer the war lasts, the more companies with weak pricing power will lower forecasts,” said Brian Madden of First Avenue Investment Counsel to Reuters. “Those with strong pricing power will pass costs on to consumers, potentially fueling higher inflation.”
Pricing power refers to a company’s ability to raise prices without losing customers—typically stronger for well-known brands or unique products.
Context
Approval ratings for the economic policies of Donald Trump have dropped sharply over the past month amid rising prices driven by the conflict with Iran, with even Republican voters showing declining confidence.
Meanwhile, commercial shipping through the Strait of Hormuz has nearly halted after a brief resumption, and Iranian state media warned of “necessary measures” against U.S. forces following recent naval incidents in the area.
