Before I started covering fashion, I was an oil reporter. I’ve rarely had the opportunity to use that knowledge in my current role, but these days I’m certainly not the only one obsessively checking the price of Brent crude futures and brushing up on the precise definition of force majeure.
For the fashion industry, much of the focus in the first days of the US-Israel war with Iran has been on the human toll, as well as the disruption to travel and business across the Gulf region. Iran has fired missiles and drones at many of its neighbours, shattering the carefully cultivated perception of Dubai, Qatar and other Gulf states as safe havens in a turbulent part of the world. You can read more on this from my colleagues Eric Sylvers and Shayeza Walid here and here.
But the effects of the conflict won’t be contained to the Gulf, or the luxury sector, for long. How those wider ripple effects play out depends largely on the price of crude. Iran sits on one side of the Strait of Hormuz, a narrow body of water through which about 20 percent of the world’s oil supply must pass. Brent crude futures, the global benchmark, just logged their biggest weekly gain on record, closing Friday at $92.69, a more than two-year high. In the US, gasoline prices have surged more than 40 cents per gallon in just one week, according to AAA.
This sort of price shock can affect fashion businesses at every level. A spike in fuel prices instantly forces some consumers to cut spending in other categories and can crush already weak sentiment. Ships and planes used to whisk apparel from manufacturers to stores and customers become more expensive to operate. The cost of making clothing goes up, too — oil is the main feedstock for most synthetic fabrics.
No wonder then that the brands and retailers reporting earnings last week offered up conservative guidance for the coming months, even as many reported banner results for the start of 2026.
Businesses will need to take a hard look at their supply chains if the conflict drags on or inflicts lasting damage on the region’s energy infrastructure. A sustained period of high energy prices would, on the margins, tilt some brands to incorporate more natural fibres, or even move manufacturing closer to their biggest markets to save on shipping costs. Clean energy would also potentially get a boost, as the economics of renewables become more favourable.
All of this depends on how the war plays out. For now, the focus is on the fighting in the region, and the civilians caught in the crossfire.