Uganda braces for rising fuel costs as Iran closes strait of Hormuz

On Saturday 28 February 2026, Iran’s Islamic Revolutionary Guard Corps (IRGC) broadcast warnings to vessels that no ship is allowed to pass through the Strait of Hormuz.

The strait is one of the world’s most strategic energy corridors. 

Officials from the EU naval mission Aspides and UK maritime authorities said ships in the Gulf have received transmissions declaring that passage is barred, potentially signalling an effective closure of the strait. 

Although Iran itself has not issued a formal state proclamation, the practical impact is being felt by shipping companies around the world.

The development comes amid a sharp escalation in the Middle East conflict, with confirmed reports of airstrikes by the United States and Israel on Iranian targets and Iran’s retaliatory actions across the region. 

These hostilities have contributed to heightened fears about the security of international energy supplies and global trade routes.

For Uganda, a landlocked nation that imports the vast majority of its fuel and key commodities, disruptions to global energy markets could translate quickly into higher costs at the pump and on shop shelves:

The Strait of Hormuz is a narrow sea passage linking the Persian Gulf to the Gulf of Oman and Arabian Sea, through which around 20 % of the world’s crude oil and significant volumes of liquefied natural gas flow. Even the threat of a prolonged closure tends to push crude prices higher as markets factor in supply risk.

Crude price increases feed into the cost of imported petrol and diesel, which are essential for transportation, agriculture and industrial operations in Uganda. 

Higher global prices typically result in more expensive fuel at the Ugandan pump, driving up transportation costs and inflation.

Insurance costs for tankers and freight delays are also likely to rise, adding to the cost of imported goods including fertilisers, machinery and foodstuffs that Ugandan businesses and farmers rely on.

Economists warn that even a temporary disruption could have ripple effects through global supply chains, pushing Brent crude and other benchmarks sharply upward this week.

The broader regional instability has already affected air transport. 

Due to airspace closures and heightened security risks over the Middle East, several airlines have adjusted routes or suspended services. 

Uganda Airlines on Saturday announced that it was suspending flights to Dubai.

Meanwhile, shipping insurers have escalated war-risk premiums, making it more expensive to move goods through conflict zones.