Compounded

There is no turning back, unfortunately.

- ALEX MAGNO

It will take at least a decade to replace all the damage suffered by the global economy three weeks into this insane war.It will take a generation to repair whatever further damage could happen in the coming days. This is Donald Trump’s legacy for our children.

Over the weekend, both Israel and Iran fired missiles close to the nuclear power plants. An international agency is checking reports of radioactive leakage in one facility. Should the next barrage actually hit nuclear plants, the entire region will be contaminated. At peak insanity, the entire region could be rendered uninhabitable.

Supply chains have been broken. Qatar no longer exports LNG. The country declared force majeure in the first few days of fighting. Much of Europe and Asia relies on LNG that is now offline.

As a consequence, the supply lines for petrochemical derivatives are also broken. There is no helium available for microchip production in East Asia. There is shortage of urea available for global agriculture this planting season. An international agency estimates that 45 million people will be added to ranks of the hungry.

The fertilizer shortage harms developing economies across the board. Modern agriculture relies heavily on fertilizers that are byproducts of oil processing.

Oil prices are always the headline item. Only a few weeks ago, we thought that oil priced at $100 per barrel was an apocalyptic scenario. Oil prices have gone beyond that. Authorities in Dubai warn oil could be priced at $200 per barrel.

At that pricing level, transport of goods will be frozen. Mobility will be seriously impaired. Business failures will happen like an epidemic.