The Iran War Is Disrupting More Than Oil. Here’s What Could Get Expensive Next

This article, written by Leila Sheridan, was originally published on Inc.com.

The Iran War has already put upward pressure on oil prices, but its ripple effects are now spreading far beyond gas pumps.

World leaders have already called on citizens to conserve energy, work from home, and more. Yet there are some less obvious impacts that could soon reshape the cost of everyday goods, from soda cans to smartphones to housing. A new NPR story highlights several categories of raw materials that are poised to see price increases. They include:

• Aluminum
• Helium
• Fertilizer
• Mortgage Rates and Borrowing
• Sulfur
• Plastics

Here’s a look at how each could impact a wide array of goods on the market:

Soda, Beer, And Cars

Aluminum—one of 60 minerals deemed critical by the U.S.—is used in everything from beverage cans to cars and packaging.

Since the war began on February 28, aluminum prices have jumped from about $3,050 to $3,411 per metric ton, an increase of roughly $360, or about 12 percent. After Iran struck two major smelters in the Middle East, both of which were major supplies to the U.S., prices hit a four-year high, Reuters reported. 

In fact, some manufacturers have already begun stockpiling aluminum amid fears of further disruption, according to the Financial Times. “If the situation continues, there will be more panic buying,” an executive at an aluminum producer said. “We have lived through crises in the past, but this one is very different.”

MRIs And Semiconductors

Helium shortages are also emerging, but their impact goes far beyond party balloons.

Qatar, which produces about a third of the world’s helium, has halted shipments through the Strait of Hormuz. The shortage is already affecting South Korea and Taiwan, according to NPR. 

Helium is critical for MRI machines, rocket propulsion, and semiconductor manufacturing. While experts assured that moderate price increases, like doubling or quadrupling, may not disrupt semiconductors, extreme spikes could.

Phil Kornbluth, a former gas industry executive and helium consultant, warned that the full impact hasn’t hit yet. “There is a tsunami coming, but it’s still a thousand miles offshore,” he told The New York Times. “Right now, it’s still sunny on the beach,” a sign that the disruptions to helium-dependent products may seem minor for now, but are poised to escalate quickly.

Food Prices

About a third of the world’s fertilizer shipments pass through the Strait of Hormuz, as Gulf countries like Saudi Arabia, the United Arab Emirates, Kuwait are significant fertilizer producers, CNN reported. Some plants in India, Bangladesh, and Pakistan have already halted fertilizer production entirely, pointing to a shortage of natural gas, which has pushed fertilizer prices up 25 percent overall. In some cases in the U.S., prices spikes have reached as high as 34 percent to 47 percent between January and March, according to NPR. 

According to The Fertilizer Institute, an agricultural association, U.S. farmers could be short two million tons this spring, with global production likely to fall. In short, their planting capacity will meaningfully drop. Although the consequences might not be immediate, they could nonetheless be substantial, Veronica Nigh, chief economist at The Fertilizer Institute, told NPR. 

On the ground, the pressure is already acute. In India, where smallholder farmers dominate, rising costs are becoming existential. “Right now, we are waiting and hoping,” Baldev Singh, a 55-year-old rice farmer in Punjab, told AP News, warning that many farmers may not survive without government subsidies when demand peaks.

In some regions, the crisis is already tipping into shortage. Ethiopia, for example, relies on the Gulf for more than 90 percent of its nitrogen fertilizer imports through Djibouti, a supply chain that was strained even before the war. “The planting season is now,” Raj Patel, a food systems economist at the University of Texas, told AP News. “The fertilizer isn’t there.”

Home Ownership 

Just days before the war, 30-year mortgage rates had dipped below 6 percent for the first time in over two years. Since then, they’ve climbed back to about 6.46 percent, with 15-year rates rising to roughly 5.77 percent, according to NPR. 

The jump reflects a broader shift in financial markets as investors respond to geopolitical instability, pushing borrowing costs higher and putting additional pressure on prospective homebuyers.

“I think the big thing is that interest rates are going to be higher,” Harvard economist Kenneth Rogoff told CNN, pointing specifically to long-term Treasury yields and mortgage rates. “I think they’re going to stay higher—and it’s painful.”

Battery And Tech Costs

Sulfur, a key component in batteries and semiconductor manufacturing, is another vulnerability.

Much of it moves through the Strait of Hormuz, and unlike oil or gas, it can’t easily be rerouted through pipelines. Disruptions could push prices higher, increasing costs for everything from electric vehicles to electronics, according to CNBC. 

Plastic Packaging And Components

Oil isn’t just fuel. It’s a core input for plastics and petrochemicals, meaning price shocks quickly cascade into everyday consumer goods.

Producers in the Persian Gulf supply raw materials to factories across Asia, which then manufacture products for the global market. As those supply chains tighten, the impact is showing up even in the U.S., where domestic production hasn’t insulated manufacturers from rising costs.

Executives say the increases are both rapid and unusually steep. “We’re seeing prices go up everywhere,” Dow CEO Jim Fitterling told investors, referring to polyethylene, a key plastic used in everything from detergent bottles to food packaging, according to The Wall Street Journal. “In my 25 years in the plastics industry, I’ve never seen a monthly increase this large,” Michael Greenberg, CEO of The Plastics Exchange, told CNN.