How a war in Iran is rewriting Africa’s Gulf-reliant energy security rulebook

• As global oil prices breach $100 a barrel and the Strait of Hormuz remains choked, African nations are scrambling to contain a fuel shock that threatens to undo years of hard-won macroeconomic stability.

It began, as these things usually do, with a distant plume of smoke on a satellite image and a terse statement from the Pentagon: operation Epic Fury. But for the millions of commuters in Lagos, Nairobi, and Johannesburg, the war in Iran has become an intimate, visceral reality, felt not in the geopolitics of think-tank reports, but in the sudden, sharp rise of the diesel pump and the quiet dread of another round of inflation.

Six weeks into the US-Israeli strikes on Iran and Tehran’s retaliatory closure of the Strait of Hormuz, the International Energy Agency has called this the worst energy shock ever recorded.

The strait, a 21-mile-wide choke point, normally carries about a fifth of the world’s oil and a third of its liquefied natural gas. With tankers either re-routed around the Cape of Good Hope or held up by heightened military risk, Brent crude has surged past $100 per barrel, and analysts at major investment houses are now openly discussing a $150-$200 scenario if the disruption persists for another two months.

For the developed economies of the Global North, this is a problem of fiscal recalibration. For Africa, it is an existential threat.

The continent is not just a victim of this crisis; it is a laboratory for a new kind of economic triage. From East Africa, where diesel powers the supply chains of tea and coffee, to the mines of South Africa and the fragile power grids of the Sahel, a patchwork of emergency measures is being deployed.

Some countries are reverting to the dark arts of subsidies and price controls. Others, perhaps more strategically, are using the crisis to accelerate a once-in-a-generation pivot towards local refining and renewable energy independence.

This is the story of how the Iran war broke Africa’s old energy model — and the frantic, innovative, and sometimes contradictory ways the continent is trying to build a new one.

War in Iran triggers price caps and the subsidy dilemma

For the first few weeks after the Strait of Hormuz was effectively shut, the immediate response of most African governments was the default setting of the post-colonial state: protect the consumer at all costs.

In Nairobi, the Energy and Petroleum Regulatory Authority performed a neat trick of financial engineering. Despite global price surges, it kept pump prices for super petrol, diesel, and kerosene unchanged for the March-April cycle. This was a strategic drawdown on the Petroleum Development Levy — a stabilization fund built to absorb exactly this kind of external shock.

Similarly, in South Africa, where the rand’s weakness has amplified the oil price spike, Finance Minister Enoch Godongwana introduced a temporary 3.00 rand ($0.18) per liter reduction in the general fuel levy, effective until early May. It was a short-term tourniquet designed to stem the political bleeding as much as the economic one.

But these cushions are wearing thin. In Gaborone, Botswana’s Energy Minister Bogolo Kenewendo delivered a stark warning that the National Petroleum Fund was “not in a position to cushion pump prices any longer”. Botswana is now doing what many import-dependent nations are being forced to do: passing the cost to the consumer while racing to build strategic infrastructure.

The strategic reserve race to nowhere

The crisis has exposed the fragility of just-in-time fuel logistics. With shipping lines re-routing vessels away from the Gulf, adding weeks to transit times, reserves have become the difference between stability and chaos.

• Botswana is expanding storage facilities at Francistown and Ghanzi to raise national reserves to 46 days, with plans for Tshele Hills to bring total coverage to 102 days.
• Tanzania is in a relatively comfortable position, with stocks covering about 78 days of petrol and 50 days of diesel as of late March.
• Zambia, however, declared a national emergency, suspending excise duty and zero-rating VAT on fuel imports as it scrambles to secure supplies.

Across the continent, the ability to stockpile has become the new marker of sovereign strength.

The Nigerian exception: Local refining as a geopolitical shield

While most of Africa looks outward for solutions, one major economy is looking inward. The war in Iran has provided an unexpected validation for one of the most expensive industrial bets in African history: the Dangote Refinery.

The Nigerian presidency has been quick to claim vindication for President Bola Tinubu’s controversial “naira-for-crude” policy, which forced the state-owned NNPC to supply local crude to the 650,000-barrel-per-day Lekki facility.

According to Temitope Ajayi, a senior presidential aide, the policy has ensured that while petrol prices have risen in Nigeria, from about 730 naira to between 1,200 and 1,400 naira per liter, the country has been spared the sight of long queues at filling stations that have plagued import-dependent neighbors.

“The Dangote Refinery has largely shielded Nigeria from the worst effects of the global supply crisis,” Ajayi said in a statement, adding that the refinery has cut petrol prices by 75 naira per liter even as crude prices rose, absorbing the margin to maintain social stability.

More significantly, the refinery has pivoted to become a regional supplier. In March alone, Dangote exported nearly 500,000 tonnes of refined products to Cameroon, Ghana, Ivory Coast, Tanzania, and Togo. For a continent that has historically shipped crude to Europe and bought back refined fuel at a premium, this marks a potential inflection point.

But the picture in Nigeria is not without its shadows. The refinery, which requires roughly 13 cargoes of crude monthly to operate optimally for the domestic market, is receiving only about five cargoes from NNPC. Officials have complained that local producers are not complying with the Petroleum Industry Act’s domestic supply obligations, forcing the refinery to buy expensive international crude. The promise of energy independence remains tantalizingly close, yet frustratingly out of reach.

Fuel rationing in Ethiopia, South Sudan

Further east, where the fiscal space for subsidies is narrower, the war in Iran crisis has moved from pricing to pure logistics. In these economies, the question is no longer “how much will fuel cost?” but “will there be any fuel at all?”

Addis Ababa is facing an acute crunch. Trade Minister Kassahun Gofe revealed that diesel prices have jumped from $80 to $230 per barrel and gasoline from $70 to $150. Daily diesel supply has halved from 9.2 million liters to just 4.5 million.

In response, the government has imposed a priority allocation system. A special monitoring unit now decides who gets fuel and who does not. Public transport, agriculture, major manufacturers, export shipments, and essential government projects are at the front of the queue. Everyone else must wait.

Ethiopia is also providing roughly $1.67 billion in subsidies, a massive burden for a nation that only recently exited a sovereign debt default restructuring process.

In Juba, the crisis has manifested as literal darkness. The Juba Electricity Distribution Company announced rotational power cuts in late March, with some areas experiencing 12-hour outages as diesel for generators became scarce. For a nation still recovering from decades of civil war, the fuel shock threatens to unravel fragile stability.

The silent crisis: Fertiliser and the threat of hunger

If the fuel price spike is the visible wound, the fertiliser shortage is the infection spreading beneath the skin. The Strait of Hormuz does not just move oil; it moves urea, ammonia, and other petrochemical-based fertilisers critical for African agriculture.

Globally, up to one-third of fertiliser trade passes through Hormuz. Urea prices have already risen by 50 per cent since the conflict began. For African farmers, who are already facing higher transport costs for their goods, this is a double blow.

In Kenya, Tanzania, and Ethiopia, where planting cycles are tightly aligned with seasonal rains, a missed window for fertiliser application could translate into lower yields later this year, just as global food prices are already under pressure from the war in Ukraine and climate disruptions.

The International Energy Agency has warned of a potential food crisis emerging from the energy crisis, as higher costs for inputs meet higher costs for transport. For import-dependent nations, the currency pressures will compound: a weaker local currency means more expensive food imports, which means higher inflation, which means tighter monetary policy.

The energy transition paradox

Amid the doom, there is a flicker of strategic optimism. The Iran war, by exposing the vulnerabilities of fossil fuel dependency, may be accelerating Africa’s long-delayed energy transition.

In Morocco, the crisis has triggered a wave of Chinese investment in green hydrogen and solar infrastructure, as Beijing seeks to diversify away from the volatile Gulf. The North African kingdom is positioning itself as a clean energy hub for Europe and the wider region.

In Egypt, which has seen its monthly gas import bill jump from $560 million to $1.65 billion, the government is accelerating its renewable energy target of 42 per cent of the energy mix by 2030.

Even landlocked Ethiopia is pushing a green model. Having already banned fuel-powered vehicle imports and reduced tariffs on electric vehicles, the government is betting on the Grand Ethiopian Renaissance Dam to provide the baseload power for an electrified transport future. EV penetration has jumped from 1 per cent of the market to 6 per cent in a remarkably short time.

The South African energy investment plan

For investors, the crisis has created a stark bifurcation. On the Johannesburg Stock Exchange, Sasol and coal exporters like Exxaro and Thungela have emerged as beneficiaries of higher energy prices. But for the broader economy, the higher import bill is a drag on growth.

As Cy Jacobs of 36ONE Asset Management noted, the crisis demands defensive positioning, cash, gold exposure, and disciplined diversification. This is not the time for heroic bets on emerging markets; it is a time for capital preservation.

The new normal as war in Iran goes on

A consensus is emerging among policymakers and business leaders in Africa: the old model of import-dependent, Gulf-reliant energy security is under severe threat. However, the responses look varied. From Zimbabwe’s decision to raise the ethanol blend in petrol to 20 per cent to stretch supplies, to Namibia’s plan to lease coastal storage in Mozambique. Africa is being forced to diversify, to localise, and to innovate.

The war in Iran will end eventually. The Strait of Hormuz will reopen. But the lesson has been learned: energy is not just a commodity; it is the lifeblood of sovereignty. And for a continent that has too often been a price-taker in global markets, the shock of 2026 may yet prove to be the catalyst for a more resilient, self-sufficient future.

In the cramped offices of energy ministries from Lusaka to Nairobi, the crisis committees are working late into the night. They are running scenarios, negotiating with traders, and calculating how many days of diesel are left in the tanks. It is not glamorous work. But it is the work that will determine whether Africa rides out this storm or is broken by it.

Read also: Iran war halts expected lowering of borrowing rates in Africa

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