Bread, oil and guns: the war on Ukraine and the Middle East

Russia’s invasion of Ukraine has had profound effects on the Middle East. Irang Bak and Anne Alexander look at how rising food costs and shortages are hurting the poor, while the rich profit from oil prices and arms deals.

This year’s Ramadan, for many in the Middle East and North Africa, was different from the previous years. The region is being hard hit by the effects of the war in Ukraine with the food prices soaring to a record level.

Russia and Ukraine occupy a large share of the world grain export market. In 2020, Russia accounted for 18 percent of global wheat exports and Ukraine accounted for 8 percent. Countries in the Middle East and Africa in particular rely heavily on wheat from Russia and Ukraine.

The dinner tables in the Middle East and Africa are being directly affected, as Western sanctions against Russia and war in Ukraine have halted exports of Russian and Ukrainian wheat. As the price of essential food such as wheat and cooking oil has soared, the amount of food that can be purchased for the same price has significantly decreased compared to the previous years.

In Lebanon, where Ukrainian wheat accounts for 80 percent of its imports, food prices rose 14 percent in February. Bread, the staple food, rose 27 percent, and cooking oil rose 83 percent.

In East Africa, hit hard by the effects of the climate crisis, Somalia has already suffered from drought for decades, leading to a decline in crop cultivation and pastoralism. Here, too, the price of cooking oil has doubled in a week. This is because the entirety of its wheat and cooking oil imports are from Ukraine and Russia.

Around 70 million Egyptians rely on subsidised bread while al-Sisi’s arms-
buying spree continues |Photo: Wikimedia Commons

The situation in Egypt, the most populous country in the Middle East, is even worse. Egypt relies on Ukraine and Russia for 70 percent of its wheat imports, accounting for about half of all wheat imports to the Middle East and Africa. Egypt applied for a loan from the International Monetary Fund (IMF) because it could not afford the soaring food prices after the war in Ukraine.

About 70 million people, or most of Egypt’s working class, depend on cheaply supplied bread from government subsidies to survive. In Egypt, bread is ‘Aish’ in Arabic, which literally means ‘life’. Under these circumstances, it is unclear whether the Egyptian regime will be able to safely overcome the storm caused by the imperialist clash between the West and Russia in Ukraine.

However, the crisis and suffering caused by the war is also resulting in resistance and protests across the region. Already in Iraq, Sudan, protests against rising prices for food and basic living prices have taken place. Therefore controlling the bread prices has been vital for rulers of the region to maintain their power.

In 1977, Egypt witnessed the ‘bread riots’ after Sadat implemented neoliberal ‘infitah’ policies. The revolts were only contained after the military was deployed. More recently, the rising cost of living became once again one of the driving forces behind the revolutions which swept the Middle East and North Africa in 2011. The revolution that toppled Omar el Bashir of Sudan in 2019 was also ignited with school students protesting against the rise of bread prices.

Meanwhile, the war in Ukraine has reconfigured global oil and gas supply chains and markets. European sanctions on Russian oil have not dented the overall volume of Russian oil exports, after dipping in February and March they had bounced back to pre-invasion levels by April, according to the International Energy Agency

Instead of going to European destinations, Russian oil tankers are transporting their cargoes to Asia, with countries such as India and China buying up supplies at knocked-down prices. Russian supplies to Asia are up by 50 percent since the start of the year. 

Russia’s loss of European markets has brought big changes for African and Middle Eastern suppliers, by contrast. North African oil exports to Europe are up by 30 percent since March and supplies shipped through Egypt’s Sidi Kerir port – most likely Saudi crude – had almost doubled between March and May. 

Although the US has increased supplies to its European allies, there is no doubt that the Gulf states such as Saudi Arabia and UAE have been major winners from the Ukraine war in economic terms. This is likely feeding their confidence to assert “strategic neutrality” from the US in relation to the conflict with Russia. The Saudi and Emirati rulers are reported to have called Vladimir Putin March and UAE abstained with India and China on a UN Security Council resolution condemning Russia’s invasion of Ukraine.

Weapons deals are also playing a role in shaping the response of states such as Egypt to the crisis. Under Al-Sisi’s military regime, arms imports have soared, with Egypt becoming the third largest weapons importer in the world last year. Despite the long-term relationship between the US and the Egyptian military, al-Sisi has also bought large amounts of arms from Russia in recent years. Between 2010 and 2014 around 47 percent of Egyptian arms purchases were from the US, but that figure dropped to 15 percent between 2015-2019, with Russian sales rising to 34 percent. By 2020, Russia was Egypt’s main arms supplier, thanks to funding from Saudi Arabia and UAE. A Russian loan of $25bn is also financing the construction of Egypt’s first nuclear power plant. 

The response of the US has been to offer more weapons to Al-Sisi’s regime, in a bid to “woo” the Egyptian military away from Russian influence. In May the Biden administration approved a potential sale of anti-tank missiles worth nearly $700 million, despite continuing human rights abuses.

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