The Middle East war is no longer a distant geopolitical crisis. It is becoming a household price story from Tokyo to Jakarta.

The first sign of an energy crisis rarely arrives as a headline. It comes as a small adjustment.

A taxi meter rises a little faster in Manila. A bowl of noodles costs more in Bangkok. A logistics manager in Busan recalculates a shipping contract before breakfast. A family in Dhaka delays buying a new refrigerator because electricity, cooking gas, school fees and rice are suddenly competing for the same monthly envelope.

This is how war travels now. Not only through missiles, ships and statements, but through fertilizer, freight, diesel, airfares, food stalls, factory floors and the quiet mathematics of ordinary life.

The World Bank Group’s latest Commodity Markets Outlook has put numbers around that anxiety. Energy prices are projected to surge by 24% this year to their highest level since Russia’s invasion of Ukraine in 2022, as the war in the Middle East sends a severe shock through global commodity markets. Overall commodity prices are forecast to rise 16% in 2026, driven by soaring energy and fertilizer prices and record-high prices for several key metals.

For Asia, the shock is especially intimate. The region is not simply watching the Strait of Hormuz. It is connected to it.

The International Energy Agency says that in 2025 nearly 15 million barrels per day of crude oil, almost 34% of global crude oil trade, passed through the Strait of Hormuz, with most of those exports destined for Asia. China and India together received 44% of those exports, while Japan and Korea are particularly reliant on oil flows through the strait.  

That single geography — a narrow waterway between Iran and Oman — has become one of the most important economic stories in Asia.

Attacks on energy infrastructure and shipping disruptions in the Strait of Hormuz, which handles about 35% of global seaborne crude oil trade, have triggered the largest oil supply shock on record, with an initial reduction in global oil supply of about 10 million barrels per day. Even after moderating from their recent peak, Brent oil prices remained more than 50% higher in mid-April than they were at the start of the year. Brent oil is forecast to average $86 a barrel in 2026, up sharply from $69 a barrel in 2025. These forecasts assume that the most acute disruptions end in May and that shipping through the Strait of Hormuz gradually returns to pre-war levels by late 2026.

The International Energy Agency’s April oil market report echoes the scale of the rupture, saying global oil supply plummeted by 10.1 million barrels per day in March to 97 million barrels per day after attacks on energy infrastructure and restrictions to tanker movements through the Strait of Hormuz.  

For years, Asia’s growth story has been told through airports, data centers, electric vehicles, industrial parks, luxury malls and rising middle classes. But all of that still rests on the old foundations: ships, fuel, fertilizer, metals, ports and power grids.

Now those foundations are shaking.

“The war is hitting the global economy in cumulative waves: first through higher energy prices, then higher food prices, and finally, higher inflation, which will push up interest rates and make debt even more expensive,” said Indermit Gill, the World Bank Group’s Chief Economist and Senior Vice President for Development Economics. “The poorest people, who spend the highest share of their income on food and fuels, will be hit the hardest, as will developing economies already struggling under heavy debt burdens. All of this is a reminder of a stark truth: war is development in reverse.”

That sentence — war is development in reverse — lands heavily in Asia because development here is often measured not in abstractions, but in fragile progress. A household gets air conditioning. A daughter moves to the city for university. A family opens a shop. A farmer buys better seed. A factory adds a night shift. A young couple moves from a rented room into a small apartment.

Energy shocks do not erase all of that at once. They squeeze it.

The IMF has warned that Asia’s economic resilience is being tested by the energy shock. In emerging Asia, inflation is projected to rise from 1.1% in 2025 to 2.6% in 2026, driven partly by upward revisions in China and India.   The Asian Development Bank has also said the Middle East conflict has injected new uncertainty into a fragile global landscape, disrupting trade and energy markets.  

The impact will not be evenly distributed. Wealthier economies such as Japan and South Korea have more fiscal capacity and strategic reserves, but they are also deeply exposed to imported energy. Developing economies may have younger populations and stronger growth momentum, but less room to absorb higher import bills. Island economies and fuel-importing nations face a particularly brutal equation: when oil rises, almost everything else follows.

In Japan, the concern is already visible in policy. The Bank of Japan held its benchmark rate steady amid worries about the Middle East conflict and energy prices, with the outlook clouded by instability in the region.  

In Southeast Asia, the pain is likely to appear in transport, food and household energy. In South Asia, it may move quickly into currencies, subsidies and food security. In China, the shock intersects with an economy already navigating property stress, weak consumer confidence and the enormous energy demands of data centers, electric vehicles and industrial production.

The energy crisis is also becoming a food story.

Fertilizer prices are projected to increase by 31% in 2026, driven by a 60% jump in urea prices. Fertilizer affordability will fall to its worst level since 2022, eroding farmers’ incomes and threatening future crop yields. If the conflict proves more prolonged, these pressures on food supply and affordability could push up to 45 million more people into acute food insecurity this year, according to the World Food Programme.

This is where the crisis moves from markets into kitchens.

Urea is not a dinner-table word, but it helps decide what dinner costs. When fertilizer prices rise, farmers use less or pay more. Either choice carries consequences. Lower fertilizer use can reduce yields. Higher fertilizer costs can push up food prices. In rice-growing Asia, where food remains politically and emotionally central, the aftershock of oil can arrive months later as a more expensive bag of rice.

The World Bank’s warning is that these shocks do not stay in one lane.

Prices for base metals, including aluminum, copper, and tin, are also expected to reach all-time highs, reflecting strong demand related to industries including data centers, electric vehicles, and renewable energy. Precious metals continue to break price and volatility records, with average prices forecast to increase 42% in 2026, as geopolitical uncertainty fuels demand for safe-haven assets.

This is the contradiction of the Asian future. The same region trying to electrify transport, build renewable capacity, expand AI infrastructure and modernize manufacturing is now facing a commodity shock that makes the materials of that future more expensive.

Copper is not just copper. It is wiring, charging stations, solar farms, factories and apartment towers. Aluminum is not just aluminum. It is construction, vehicles, packaging and infrastructure. Tin is not just tin. It is electronics, circuit boards and the hidden nervous system of modern life.

Asia’s growth model depends on movement: of goods, people, energy, components and capital. A commodity shock slows that movement.

Rising commodity prices caused by these shocks will increase inflation and dampen growth worldwide. In developing economies, inflation is now projected to average 5.1% in 2026 under the baseline assumptions—a full percentage point higher than was expected before the war and an increase from 4.7% last year. Growth in developing economies will also deteriorate as higher prices for essentials weigh on incomes and exports from the Middle East face sharp curbs. Developing economies are expected to grow by 3.6% in 2026, a downward revision of 0.4 percentage point since January. Economies directly impacted by conflict will be hardest hit, and 70% of commodity importers and more than 60% of commodity exporters worldwide could see weaker growth than was projected in January.

The danger is not only that prices rise. It is that governments respond badly.

When fuel prices rise, political pressure builds quickly. Voters want relief. Businesses want subsidies. Farmers want protection. Transport operators want support. But after years of pandemic spending, debt stress and higher borrowing costs, many governments have less room to move.

“The succession of shocks over the decade has sharply reduced the fiscal space available to respond to the current historic energy supply crisis,” said Ayhan Kose, the World Bank’s Deputy Chief Economist and Director of the Prospects Group. “Governments must resist the temptation of broad, untargeted fiscal support measures that could distort markets and erode fiscal buffers. Instead, they should focus on rapid, temporary support targeted to the most vulnerable households.”

That advice is easy to write and hard to execute. Broad subsidies are politically attractive because everyone feels them. Targeted support is more efficient, but it requires administrative precision, trust and speed. In much of Asia, the question is not whether governments know what good policy looks like. It is whether they can deliver it before public frustration turns into something larger.

The World Bank also warns that the story could get worse.

Commodity prices could rise even higher if hostilities escalate or supply disruptions from the war last longer than projected. Brent oil prices could average as high as $115 a barrel in 2026 in a scenario where critical oil and gas facilities suffer more damage and export volumes are slow to recover. This in turn would have ripple effects on prices for fertilizer and alternative energy sources such as biofuels. Under this scenario, inflation in developing economies could rise to 5.8% this year, a level exceeded only in 2022 over the past decade.

That scenario would be felt almost everywhere, but Asia would be one of its main theatres. Not because the war is being fought there, but because the region has become the great engine of global demand.

Reuters reported that Brent crude rose above $111 a barrel on April 28 as supply disruption persisted around the Strait of Hormuz, with about 10 million barrels per day of oil shipments disrupted.   The World Bank had already noted that crude prices rose nearly 40% between February and March, while the price of liquefied natural gas shipments to Asia rose by almost two-thirds.  

LNG matters because Asia’s energy transition has relied heavily on gas as a bridge fuel. Japan and South Korea use it to support power generation. China uses it as part of a broader effort to shift away from coal in some sectors. South and Southeast Asian economies see it as a way to meet rising energy demand without leaning entirely on older fuels.

But bridge fuels are still fuels. And when geopolitics raises the toll, every bridge becomes more expensive.

The report’s special focus finds that oil-price volatility during periods of rising geopolitical risk is roughly twice as high as during calmer periods, with a geopolitically driven 1% decline in oil production pushing prices up by an average of 11.5%. Critically, these effects spill over into other key commodity markets, with an impact roughly 50% larger than under normal market conditions. According to the report, a 10% oil price increase triggered by a geopolitical supply shock leads to natural gas price increases peaking at about 7% and fertilizer price increases peaking at over 5%. These peaks typically occur about a year after the initial oil price shock, with adverse consequences for food security and poverty reduction.

That lag is the part many consumers do not see coming.

An oil shock begins at sea. Then it appears at the pump. Then in electricity bills. Then in shipping invoices. Then in fertilizer contracts. Then in harvests. Then in grocery stores. Then in wage demands. Then in interest-rate decisions. Then in smaller birthday parties, delayed weddings, fewer restaurant meals, postponed vacations and children quietly told that some things will have to wait.

The Middle East war may be geographically distant from much of Asia. Economically, it is already inside the house.

For policymakers, the challenge is to prevent a supply shock from becoming a social crisis. For businesses, it is to protect margins without destroying demand. For households, it is simply to endure another round of prices moving faster than incomes.

The larger lesson is uncomfortable. Asia’s future may be digital, electric and urban, but it remains deeply exposed to the old vulnerabilities of the global economy: chokepoints, tankers, war, weather, fertilizer and fuel.

The region has spent decades mastering speed. Now it may have to master resilience.

Because the next phase of the Middle East war will not only be measured in barrels and basis points. It will be measured in the price of cooking oil in Jakarta, the cost of a truck route outside Mumbai, the electricity bill in Osaka, the fertilizer purchase in Vietnam, the airfare from Seoul, and the quiet decisions families make when the world becomes more expensive again.