Iran Conflict Drives Up Gas Prices, Threatens Fertilizer Supply

Analysts warn of prolonged impact on energy and agriculture markets if Strait of Hormuz remains closed

Mar. 14, 2026 at 8:15am

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The ongoing conflict between the U.S., Israel, and Iran has led to a blockade of the Strait of Hormuz, a critical oil shipping route. This has resulted in a significant reduction in global oil production, causing gas prices to spike across the United States. Experts also warn that the disruption to the Strait of Hormuz could impact the supply and pricing of key agricultural fertilizers, potentially affecting planting decisions for U.S. farmers.

Why it matters

The Strait of Hormuz is a vital global energy chokepoint, with around 20% of the world's oil supply passing through it. Its closure has far-reaching implications, not just for gas prices but also for the agricultural sector, which relies heavily on fertilizers transported through the strait. This could have significant economic consequences, especially for farmers who haven't yet locked in fertilizer prices for the upcoming planting season.

The details

The blockade of the Strait of Hormuz has cut global oil production by about one-third, leading to a sharp rise in gas prices across the U.S. Even regions with typically lower gas prices, like the Midwest and Texas, have seen prices jump by 25-40 cents per gallon in recent weeks. Analysts warn that the situation will only worsen if the strait remains closed, as it is a global market issue, not just a local supply problem. Additionally, the Strait of Hormuz is a major transit point for key agricultural fertilizers, with 31% of global urea exports, 44% of sulfur exports, 18% of ammonia, and 15% of phosphate exports passing through the strait. This supply disruption could impact planting decisions for U.S. farmers, especially those in the Corn Belt who haven't yet locked in fertilizer prices.

  • Gas prices in Eudora, Kansas jumped from $2.94 to $3.20 per gallon in a week.
  • The blockade of the Strait of Hormuz began in early March 2026.

The players

Matt McClain

A petroleum market analyst for GasBuddy.

Jan Lambregts

The head of RaboResearch global economics and markets at Rabobank.

Andrick Payen

An analyst in global agribusiness at Rabobank.

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What they’re saying

“We need the Strait of Hormuz to reopen, and we need it to reopen now. Bottom line, that's what we need, that fixes everything.”

— Matt McClain, Petroleum market analyst

“The longer the Strait of Hormuz is closed, the more these facilities get damaged, the bigger the impact becomes in the energy markets and other markets.”

— Jan Lambregts, Head of RaboResearch global economics and markets

“We've seen more than anything urea and other prices increase due to the risk and low supply that is expected to come through the next coming weeks.”

— Andrick Payen, Analyst in global agribusiness

What’s next

Analysts will be closely monitoring the situation in the Strait of Hormuz and its impact on global oil and fertilizer supplies in the coming weeks. Farmers in the Corn Belt will need to make critical planting decisions in the next few months, which could be influenced by fertilizer availability and pricing.

The takeaway

The conflict in the Strait of Hormuz is having far-reaching consequences, not just for gas prices but also for the agricultural sector. This highlights the interconnectedness of global markets and the vulnerability of critical infrastructure to geopolitical tensions. Resolving the situation in the strait is crucial to stabilizing energy and commodity prices and ensuring food security.