Sigh of relief in Africa as the Strait of Hormuz 'reopens'
A potential US-Iran agreement could lower energy, fertilizer, and food prices in Africa if the Strait of Hormuz fully reopens. Oil exporters such as Nigeria
A potential US-Iran agreement could lower energy, fertilizer, and food prices in Africa if the Strait of Hormuz fully reopens. Oil exporters such as Nigeria and Angola might have to cope with less revenue, experts say. The prospect of a peace agreementbetween the United States andIran is fueling optimism across global financial and commodity markets. At the center of attention is the Strait of Hormuz—one of the world's most important shipping routes and a critical artery for global oil flows. A large share of traded crude passes through the narrow corridor between the Persian Gulf and the Gulf of Oman. Any disruption pushes energy prices higher, while easing tensions typically stabilizes markets. If the agreement announced by US President Donald Trump were to materialize and shipping were to fully resume through the Strait, Africa could be among the main indirect beneficiaries. Lower oil prices, reduced freight costs and smoother trade flows would bring relief to economies heavily exposed to imported inflation — particularly in energy, fertilizers and food. A potential US‑Iran deal could therefore act as a broad stimulus and food security package for many African countries. The greatest gains would likely accrue to energy- and fertilizer-import-dependent economies in East Africa, North Africa and the Sahel. By contrast, oil producers such as Nigeria, Angola and Algeria would benefit less. The 'best news' for Africa in a long time Hopes are especially high in East Africa, where policymakers and businesses are closely watching developments. "This is the best news for Africa in a long time," Samuel Nyandemo, an economics professor at the University of Nairobi, told DW.
For Nyandemo, the impact would extend well beyond energy markets. "Once the route is opened, we expect smooth mobility of goods and services," he said, noting that exports to Europe and Asia could again flow without costly detours, stabilizing supply chains and cutting transport expenses. Recent disruptions have significantly raised freight costs. "Because of the disruption of this route, transport costs have increased significantly, as we now have to take much longer detours." US, Iran announce initial 'peace deal' To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video According to Nyandemo, East African countries have been hardest hit by tensions in the Gulf. "While West African countries and South Africa can rely on alternative routes, we in East Africa are mainly dependent on this route," he explained, stressing the region's dependence, especially for energy, fertilizers and some food imports. The reliance is substantial. Roughly 26% of Kenya's fertilizer imports pass through the Strait of Hormuz. In Sudan, the share exceeds 50%. Globally, about one-third of seaborne fertilizer trade flows through the region. The agricultural sector has been particularly affected. In Kenya, exporters of flowers, vegetables and other horticultural goods have faced rising costs. "We have suffered major losses in the horticulture sector," Nyandemo said. The war in the Middle East dealt a huge blow to Kenya's cut flowers industry Image: Zhang Chen/Photoshot/picture alliance At the same time, higher import prices have driven broader inflation. "When fuel prices fall, inflation slows, whether in transport, production or food." Energy is a central driver of inflation across many African economies.
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