The impact of the ongoing war in Ukraine on Lebanon is burgeoning day after day. Although the sound of bombings is not heard in Beirut, but its impact threatens the livelihood of the Lebanese and their basic needs.

In addition to the wheat crisis, the upward trajectory of global oil prices creates a calamity that affects all exhausted economic sectors in Lebanon, including the shipping sector.

Maritime shipping acquires about 90 percent of global trade, according to the International Chamber of Navigation, and imports through sea represent more than 70 percent of the volume of goods imported to Lebanon.

Disrupted Supply chain

Russia’s war on Ukraine has disrupted the supply chain and impacted the shipping sector severely, according to the President of the International Chamber of Navigation in Beirut, Elie Zakhour. Russian and Ukrainian seafarers make up 14.5 percent of the global shipping workforce, according to the International Chamber of Navigation.

Lebanon imports a variety of products and raw material from Russia and Ukraine mainly wheat, oils and grains, and fuel, but due to the war imports from the Black Sea region have become impossible, according to Zakhour.

While the Lebanese government is striving to secure bread for Lebanese, importers, traders and industrialists in Lebanon are seeking to find alternative import markets, such as the United States, Latin America and Canada, but this process needs time, especially since most countries have stopped exporting basic materials in order to preserve their food security, according to Zakhour.

Oil prices

Lebanon’s imports from Turkey as well as from Asian and American markets are still ongoing,  but the rise in oil prices imposes a new reality. The global price of a barrel of oil has reached $130 and may rise further as the crisis in Ukraine continues. This will lead to an increase in shipping costs, according to Antoine Mouhayar, General Manager of Navigators Company.

Mouhayar explained that the shipping cost is rising dramatically due to surge in global oil prices, noting that the sector “has not yet recovered from the repercussions of the closure imposed by the Covid-19 pandemic, which raised prices significantly.” The cost of shipping a container, which was $700 two years ago, has soared to $7,000 after the Ukrainian crisis.

Soaring prices of consumer goods

The raise in shipping cost will affect the prices of consumer goods locally, as well as the cost of internal transportation in light of the economic and financial crisis that Lebanon is witnessing.

These costs are added to the unprecedented rise in commodity prices in global markets due to the disruption of the supply chain, according to Zakhour. He said that Lebanese are paying these costs from their wages that has lost about 90% of its value. The rise in global prices has impacted the price of bread, which soared to 10,000 LBP per bundle. The Ministry of Economy has attributed this rise to “the significant rise in fuel prices that directly affect the price of flour and the cost of production, in addition to the increase in the prices of wheat, sugar, and oil in international markets.

Far from the Ukrainian battle that is being fought with heavy weapons, the Lebanese see themselves in the midst of an open daily battle to find their basic needs and pay for it.