Middle East tensions: What will be the impact on fashion’s supply chain?

As military tensions escalated between Israel and Iran, global trade held its breath. At the heart of concerns was the Strait of Hormuz, the strategic maritime corridor through which nearly one-third of the world's oil passes. If this passage were to be blocked or seriously disrupted, the repercussions would not be limited to energy markets. The fashion sector, often thought to be far removed from these geopolitical considerations, could feel the tremors suddenly and abruptly.

Oil dependent sector

The fashion industry is often perceived as light, cosmopolitan and creative. However, its foundations are closely linked to fossil fuels. From the manufacture of polyester - a fibre derived from petroleum - to maritime container transport, the entire supply chain relies on oil, both as a raw material and as a logistical lever. A blockade of the Strait of Hormuz would lead to a surge in the prices of crude oil and liquefied natural gas (LNG), with immediate repercussions on production, transport and distribution costs. Manufacturing clothes would become more expensive, and their delivery to Europe and the US would be slowed and increased in price.

Supply chain under tension

Since the Covid-19 pandemic, the fashion supply chain has never really regained its balance. Trade tensions, the war in Ukraine, rampant inflation in 2022 and, more recently, disruptions in the Red Sea had already undermined just-in-time production strategies. The new threats looming over the Middle East added an additional degree of uncertainty: they could lengthen delivery times, force carriers to change their routes and push costs up to a critical level.

"Any disruption in the Strait of Hormuz would have rapid repercussions on the European manufacturing sector, already weakened by its dependence on Qatari LNG and hydrocarbons in general," warned Marco Forgione, director general of the Chartered Institute for Exports and International Trade, quoted by Euronews.

Raw materials and logistics under pressure

Textiles are a globalised industry, largely dependent on imports. Cotton, polyester, viscose: these raw materials come from multiple regions, but polyester, in particular, is directly indexed to the price of oil. A surge in crude oil prices would therefore impact not only the costs of synthetic fibres, but also those of the chemical dyes used in fabric dyeing.

Moreover, a large proportion of clothing and textile components are produced in Asia - India, Bangladesh, Pakistan, China - and transit through maritime routes now exposed to geopolitical hazards. In the event of disruption in the Strait of Hormuz, carriers would have to bypass the area, which would considerably lengthen lead times and generate significant additional costs, the media outlet Koha noted.

SMEs on the front line

Most major international brands have sufficient safety stocks and financial resources to absorb, at least temporarily, logistical shocks. This is not the case for small and medium-sized enterprises, young brands or DNVBs (digital native vertical brands), which are often very exposed to cost volatility and the slightest disruption to international flows.

"It is certain that business leaders are tearing their hair out, especially the leaders of SMEs, micro-enterprises and small and medium-sized enterprises," Forgione said. "This is yet another episode of uncertainty and upheaval, on top of the US’ announcements of tariffs and the current unrest in the Red Sea and the Suez Canal."

For these players, every container delay or freight increase can threaten their financial balance. Some companies had also begun to relocate part of their production to the Mediterranean basin - in Tunisia, Turkey, Greece - in a nearshoring approach. But this strategy could also be called into question if geopolitical instability were to spread to the entire region.

"You know, anyone involved in a supply chain is really on edge, trying to manage enormous complexity. It's like playing four-dimensional chess, trying to manage all the complexities and pressures you face," Forgione continued.

Redefining logistical routes?

Faced with this threat, Europe will probably have to accelerate the diversification of its supply routes. Greece, provided it invests massively in its port and rail infrastructure, could become a key logistics platform for goods from Central Asia and Turkey. But such a transformation would require deep modernisation: digitalisation of customs procedures, optimisation of rail networks, improvement of port capacities. At the same time, the most responsive fashion brands could invest more in the automation of their European warehouses and multiply regional distribution centres in order to limit their dependence on the most vulnerable global hubs.

Uncertainty sets in

A this stage, three trajectories seemed possible. A lasting escalation of the Israeli-Iranian conflict would lead to a prolonged surge in energy prices, major disruption to value chains and persistent inflation in clothing prices. A short but intense crisis would have temporary logistical effects, with tensions on deadlines and margins, but rapid adaptation by rerouting flows. Finally, a return to diplomacy would avoid a major crisis, while strengthening companies' awareness of the lasting fragility of their supply chains.

Fashion facing its energy dilemma

The Israeli-Iranian conflict, however distant it may seem from stylistic concerns, recalled a structural truth: that the fashion industry remains highly dependent on oil. From synthetic fibres to maritime transport, black gold irrigates the entire value chain. This dependence invites companies in the sector to fundamentally rethink their supplies, making them closer, more diversified and less carbon-intensive. A strategic imperative, but also an economic and ecological necessity.