Gulf Conflict Sparks Global Food Inflation Fears

World markets are facing increased tensions and risks as the Gulf conflict rages on. A super El Niño, higher energy costs, and fertilizer shortages linked to the Middle East conflict are fueling fears of another wave of food inflation.

The impact is expected to be most severe in Asia and Latin America, where households spend a larger share of their income on food. Economies such as India have already felt the effects.

A strong El Niño could raise global food inflation by about 0.7%, according to JPMorgan estimates.