Why Gulf nations are flying in basic necessities as Hormuz closure raises cost of living – analysis

The closure of the Strait of Hormuz to commercial shipping since March has significantly increased the cost of living in Gulf nations, which are now flying in essential goods like food and household items. This shift from sea freight to air cargo has led to inflation in countries such as Kuwait, the UAE, Bahrain, Qatar, and Saudi Arabia, as noted by Shon Hiatt, an associate professor at the University of Southern California, who stated, "A lot of the necessities...comes in by boat...they've been flying in...And that's caused inflation in these states."

• The media's focus on oil prices has largely overlooked the impact on basic necessities, with air freight proving unsuitable for large volumes of goods like grain or building materials.
• Shipping companies, including Maersk, implemented emergency surcharges early in the crisis, while attacks on oil and gas infrastructure, such as the Ras Laffan plant in Qatar, have further disrupted exports.
• Ports outside the Strait, like Sohar in Oman, have seen a significant increase in cargo traffic, and forecasters have adjusted inflation expectations upwards for Gulf Cooperation Council countries.
• The crisis has also spurred interest in alternative trade routes, such as the India-Middle East-Europe Economic Corridor (IMEC), to bypass chokepoints like Hormuz, with Cauvery Ganapathy of ORF Middle East stating, "The closure of the strait has argued the case for IMEC much better than any project proposal could have."