Turkey Flags Economic Risks from Escalating US-Israel-Iran Conflict
Speaking on Türkiye’s Akit TV, Simsek highlighted that the war is unfolding in one of the world’s most important energy and trade corridors, which supplies nearly 20% of global oil. This makes the current breakdowns in supply chains particularly concerning. He added that sustained oil price increases could have a significant impact on global inflation.
Simsek noted that Brent crude prices have surged more than 40% compared to pre-war levels, European natural gas costs jumped over 56%, and jet fuel prices nearly doubled. Simultaneous disruptions in the Red Sea and the Strait of Hormuz have extended shipment times between Asia and Europe.
He warned that a prolonged conflict could trigger global inflation, tighter financial conditions, and even potential stagflation. Following the outbreak, Türkiye took proactive measures to mitigate the economic impact. These efforts limited declines in Turkish markets, with the stock market falling only 5.5%, compared to drops of 10% or more in Indonesia, South Korea, and South Africa.
Simsek emphasized that Türkiye remains a stable hub for global businesses seeking alternatives to diversify their supply chains. He also highlighted the country’s strong defense industry, which bolsters both its deterrence capabilities and technological development.
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