THE Confederation of Zimbabwe Industries (CZI) has said the United States of America-Israeli conflict against Iran has had mixed implications on Zimbabwe’s economy, pushing prices for oil-based products and gold, the country’s single largest export.
This comes after the Zimbabwe Energy Regulatory Authority (ZERA) increased fuel prices twice this month due to rising global oil prices driven by supply chain disruptions linked to the ongoing United States-Israeli conflict against Iran.
Tensions in the Middle East have disrupted the passage of tankers through the Hormuz Strait, a key maritime route that handles about 20 percent of global oil supplies.
Iran has threatened to mine the waterway, attack regional infrastructure and intercept shipping in response to US and Israeli actions, including threats against Iranian power plants.
In its latest pricing update for March 2026, ZERA set the diesel price at US$2,05 per litre and petrol (E5 blend) at US$2,17 per litre, equivalent to ZiG52,19 and ZiG55,13, respectively.
The energy regulator said the adjustments were necessary to reflect mounting cost pressures on the international market while safeguarding local fuel availability.
As of late March 2026, the Middle East conflict has driven global oil prices over US$100 to US$113+ a barrel (Brent crude), up from around US$70 before the conflict began, marking a significant surge due to supply disruptions in the Strait of Hormuz.
The disruption, described as a historical crisis surpassing the 1970s shocks, has also cut liquefied natural gas (LNG) flows by roughly 20 percent. Prices jumped from US$10 to over US$30 per metric million British thermal unit (MMBtu).
In a statement, CZI said energy markets have been the most immediate casualty of the conflict.
“Oil prices surged as traders factored in the risk of supply disruptions from the Gulf region. Prior to the escalation, Brent crude oil traded near US$70 per barrel in mid-February 2026,” said CZI.
“As tensions intensified following joint USA and Israel strikes on Iranian targets, prices rose sharply. By March 2, Brent crude had already jumped over 13 percent to above US$82.”
The business lobby said the conflict has also disrupted fertiliser markets, particularly nitrogen fertilisers such as urea and ammonia, which are mainly produced in the Middle East and depend on natural gas as a key input.
Global urea prices jumped by about 31 percent to settle at US$591 per tonne between February 11, 2026, and March 11, 2026.
“For Zimbabwe, the timing is critical as the country prepares for the winter cropping season. Rising fertiliser prices are likely to increase production costs for key crops such as wheat, maize and tobacco, potentially affecting farmer input decisions and increasing the cost of Government-supported input programmes,” said CZI.
Maize, tobacco, and wheat are cornerstones of Zimbabwe’s economy and food security.
Maize is the primary staple food for citizens, tobacco is the second-largest foreign currency earner and wheat is a vital, strategic crop for food self-sufficiency.
“Rising energy and fertiliser costs are now filtering into global agricultural markets, where fuel and fertilisers are indispensable inputs for farming.
“As production expenses increase, food commodity prices have begun to surge.”
According to CZI, global grain markets reacted strongly, with soybean futures rising by 8 percent to settle at US$12,14 per bushel by March 11, 2026, from the February 11, 2026, price levels.
Wheat markets also experienced price increases, which rose from US$537 per bushel on February 11 to US$635 by March 9, amid fears of prolonged conflict and supply disruptions.
Meanwhile, CZI said precious metals have similarly responded to the geopolitical tensions, as investors seek safe haven assets during the period of heightened global uncertainty.
Global gold prices have risen steadily as capital shifts from riskier holdings into haven assets.
Gold prices are rising due to intense safe-haven demand fuelled by global geopolitical tensions, significant central bank purchases and hedge-seeking behaviour against inflation and currency volatility.
Between February 11 and March 11, 2026, the price of gold, Zimbabwe’s largest export, which accounted for 47 percent of external shipments in 2025, generating over US$4 billion, increased by 2 percent to US$5 179 per ounce.
“This movement reflects heightened risk aversion and expectations of prolonged instability, consistent with historical patterns during periods of war, inflation and currency volatility,” CZI said.
“For Zimbabwe, the implications are mixed. Rising global energy prices increase operational costs for mining companies, particularly those reliant on diesel-powered equipment and generators.
“At the same time, stronger gold prices provide a potential offset, supporting export revenues and foreign currency inflows.”
As one of the country’s key foreign exchange earners, CZI said the mining sector stands to benefit from higher international gold prices, even as input costs rise.-herald
