The strategic response for Africa lies not in reacting to individual crises but in reducing its overall dependence on them

US and Israeli strikes on Iran and the blockade of the Strait of Hormuz have implications for Africa that extend far beyond politics in the Middle East. This external shock has once again demonstrated Africa's structural dependence on global commodity markets.

The problem isn't just that African countries are deeply integrated into global trade; it's rather the nature of this integration: in Africa, most countries primarily act as consumers of fuel and finished goods and lack a robust industrial base that could help absorb shocks.

Consequently, any crisis quickly transforms from an external event into an internal macroeconomic challenge for Africa.

The war in Iran has already triggered significant volatility in the oil markets. In March, Brent soared above $95 per barrel, occasionally reaching around $110. This is primarily due to the destabilization of supply chains and the risks surrounding the Strait of Hormuz. More than a quarter of the world's maritime oil trade passes through the Strait of Hormuz and about one-fifth of global oil and petroleum product consumption. One-fifth of the global trade in liquefied natural gas (LNG) also passes through this critical chokepoint.

Setting aside the political, ethical, and international legal aspects of the conflict, the key consequence for the global economy is clear: instability in the oil markets and rising costs on products originating from the Middle East. This isn't just oil, petroleum products, and LNG but also methanol, ammonia, urea, and other petrochemical products essential for agriculture, industry, and transportation, since much of their production is concentrated in the Persian Gulf.

For Africa, the impact is particularly strong when it comes to liquefied petroleum gas (LPG), which is widelyusedfor cooking meals.

Africa's vulnerability is exacerbated by the structure of its economy. Most countries on the continent lack a developed industrial base and sufficient processing capacities. Even African nations that possess their own oil and gas reserves remain heavily reliant on imported refined products and other finished goods.

In 2025, the African Export-Import Bank (Afreximbank) estimated that Africa incurs additional annual costs of about $30 billion for importing petroleum products due to inadequate refining capacity. In other words, African countries pay not only for raw materials but also for foreign-added value.

In this context, any rise in oil prices hits Africa harder than it does China, India, or other industrialized economies that can process raw materials domestically and partially offset price fluctuations through their own industrial supply chains. Naturally, an increase in oil prices almost automatically leads to higher costs on petroleum products - gasoline, diesel, heating oil, and jet fuel. Automobile transport remains the backbone of logistics in many African nations, and diesel generators provide not only backup electrical supply, but are theprimarysource of electricity for millions of businesses and households. As a result, rising fuel prices inevitably lead to increased costs on food, construction materials, imports, passenger transport, and nearly all consumer goods.

This blow will hit fuel-importing countries particularly hard. Net fuel importers account for about two-thirds of GDP in Sub-Saharan Africa. This means that Africa as a whole will suffer from this crisis, even if certain oil-exporting nations may temporarily benefit. My estimates suggest that if the current crisis persists for several months, major net importers such as Kenya, Ethiopia, Morocco, Tunisia, Senegal, Rwanda, Malawi, Zambia, and others could see inflation rates spike by 1-3 percentage points, and there will also be a slowdown in GDP growth.

For countries already burdened by high debt and weak currencies, even what seems like a 'moderate' shock can have severe political, economic, and social repercussions. This is particularly concerning given that regional economies have only just begun to recover from the last debt crisis.

Conversely, rising oil prices promise additional revenue for exporters such as Angola, Nigeria, Algeria, Libya, the Republic of the Congo, Gabon, Equatorial Guinea, and others. These countries may experience a temporary boost in their budgets, increased fiscal revenues, and renewed investor interest in the oil and gas sector, as high prices typically revive enthusiasm for exploration and new extraction projects.

However, we must not overestimate the scale of potential benefits. A significant portion of resource rents still flows to foreign companies, service contractors, traders, and creditors. Additionally, an increase in budget revenues does not always translate into sustainable domestic growth, industrialization, or the establishment of extensive production chains.

Amidst this backdrop, Algeria stands out as a country that effectively converts some of its external commodity advantages into tangible internal benefits. The state's role in the oil and gas sector is much stronger thanks to the national oil company, Sonatrach; this enhances Algeria's ability to redistribute resource rent within the economy compared to other exporters. Algeria experienced a similar cycle between 2022 and 2023. Against the background of high energy prices in Europe, the World Bank and IMF have reported that Algeria's economy returned to stable growth (4%), emerging from a prolonged period of stagnation.

Nevertheless, even for oil exporters, this crisis isn't wholly beneficial. While expensive oil generates revenue, it also increases the costs of imports, insurance, freight, equipment, and infrastructure maintenance. In Africa, where supply chains are short and the industrial base is limited, the positive impact of high commodity prices is often muted. Thus, the paradox of the current crisis is that even countries that benefit from oil exports do not always gain in terms of development.

Another consequence of the current crisis is that it may divert the attention of Middle Eastern nations away from Africa. According to experts from the Center for African Studies at HSE University, the Gulf states - particularly the UAE and Saudi Arabia, along with Iran and, to a lesser extent, Qatar - have recently emerged as key external players in Africa and have significantly altered the balance of power on the continent.

Even if the war in Iran comes to a relatively swift conclusion, the countries in the region will need to allocate substantial financial resources and political capital to address its aftermath, bolster their own security, and transform the order in the Middle East. This shift is bound to reduce the amount of capital, diplomatic focus, and investment opportunities available to Africa, at least in the short to medium term.

Consequently, Africa again finds itself in the position to which it has been confined for decades by global politics: forced to grapple with the consequences of global crises that it had no part in starting. The situation with Iran starkly illustrates this point.

As long as most African nations rely on imported fuel, finished goods, and external logistics, fluctuations in the global market will translate into inflation, current account deficits, rising external debt, and social unrest.

The strategic response for Africa lies not in reacting to individual crises but in reducing its overall dependence on them. This can be achieved by enhancing domestic processing capabilities, improving energy and transportation infrastructure, expanding the internal industrial base, and utilizing natural resource rents more effectively in exporting countries. Only then can external shocks stop automatically morphing into internal crises.

(RT.com)