How the Middle East War Is Hitting Greek Grocery Bills — and Why Economists Say the Pain Will Last for Years

The prices are not the first thing you notice when you walk into any Athens laiki market on a Saturday morning. The pause is what it is. Customers pick up a bottle of sunflower oil, examine the label, and return it. A smaller one is picked up. The vendors are no longer feigning surprise. Last week, one of them—near Kallidromiou Street—told a regular that he had revised his cardboard signs three times this month. Three times. When the Middle East conflict finally reaches a Greek kitchen, it resembles that more than any IMF chart.

Nearly everything that ends up on a dinner plate—or at least the inputs that go into it—is imported by Greece. Black Sea wheat. Ukraine and the surrounding area produce sunflower oil. Fertilizer is mostly transported via the Strait of Hormuz, where tanker traffic has decreased by over 90% since the conflict intensified. Despite being on the edge of Europe, the nation is reliant on shipping lanes thousands of miles east, and this silent reliance is now evident at the till. Speaking with economists at the Bank of Greece and private think tanks in Kolonaki, it seems like the worst is still to come.

By themselves, the UN Food and Agriculture Organization’s early April statistics were not disastrous. In March, food commodity prices increased by 2.4%. Vegetable oil is up five. Sugar up seven. When taken separately, those are the kinds of strategies Greek households adopted to survive the 2022 energy crisis. This time, the layering is the issue. The level of energy is increasing once more. The cost of freight is increasing. No one in the shipping industry ever anticipated that insurance rates in the Gulf would reset every seven days.

Thessaly’s agronomists are most concerned about fertilizer. Hormuz handles about one-third of the fertilizer that is traded internationally, and in just the first week of March, Middle Eastern granular urea increased by almost twenty percent. Greek farmers who grow durum wheat, cotton, and maize are already reducing their nitrogen use, switching to crops that require less nitrogen, or just applying less and waiting for rain. Silently made in a field outside of Larissa in April, that choice results in a thinner harvest in September and a more costly loaf of bread by Christmas. It’s difficult to ignore how slow and challenging this type of damage is to undo.

Everything is made more difficult by tourism. Greece depends on it. The Gulf carriers that supply Athens with long-haul connections are rerouting flights, increasing fares, and occasionally reducing schedules due to rising jet fuel prices. Weaker tax revenue from fewer visitors during shoulder season means less money available for the government to provide energy subsidies to households, as it did in 2022. Based on the briefings that have leaked, there is a perception within the finance ministry that the buffers are not what they once were.

One word keeps coming up for economists: duration. Markets adjust to a brief war. Damage spreads over a long period of time, starting with prices and continuing through production, yields, and the subsequent planting cycle. Greece, which is at the receiving end of three distinct supply chains that are all being squeezed simultaneously, is experiencing a gradual tightening rather than a sudden spike in pain. It appears that investors anticipate a slowdown in inflation by the middle of 2027. In Pangrati, the grandmother weighing tomatoes is unsure. To be honest, it’s hard to disagree with her as you watch this play out.