An escalating conflict in West Asia is sending shockwaves through the global fashion supply chain, with apparel and footwear from major retailers like Zara and H&M likely to become more expensive, according to a report by Reuters.
The disruption is being driven by an energy crunch following the closure of the Strait of Hormuz, a key route for global oil shipments.
Polyester-derived from petroleum and accounting for nearly 59% of global fibre production-forms the backbone of fast fashion, used widely in garments ranging from dresses to athleisure wear. Supply constraints have pushed up raw material costs, with Chinese exporters raising prices and Indian yarn manufacturers now paying nearly 30% more for petroleum derivatives.
The ripple effects are being felt across textile hubs in India and Bangladesh.
In Surat, a key manufacturing centre, production has slowed sharply due to rising input costs and labour shortages, as migrant workers return home amid an LPG shortage linked to the crisis. Dyeing and printing units have also begun scaling down operations.
Industry players say the strain is already impacting order fulfilment. "We are not able to actually meet the demands of the global orders very fruitfully these days," Avichal Arya, CEO of Bindal Silk Mills, told Reuters, highlighting the growing pressure on suppliers catering to global brands.
While the cost burden is expected to move downstream to retailers, some companies say the immediate impact remains contained. H&M said it has not witnessed major disruptions in Bangladesh, adding it has seen no "noticeable number of requests from suppliers to adjust orders in connection with energy costs".
Meanwhile, some mitigation strategies are in play. Zara has increased its use of recycled polyester-made from plastic waste-to reduce dependence on oil-linked inputs, though such materials still account for a small share of overall production.
British retailer Primark said its current and upcoming inventory remains largely insulated, noting it was not sourcing energy-sensitive raw materials for those collections.
The impact extends beyond clothing. Footwear manufacturers are also facing cost pressures, with petrochemical-based components widely used in sneakers.
The Footwear Distributors and Retailers of America flagged widespread impact, with its president Matt Priest stating, "There's broad-based impact across the board no matter where you source your shoes from."
However, Nike struck a more measured note, saying, "Materials related to oil do have an impact on product costs."
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