The conflict between the US and Iran, now reaching its 30th day on Saturday, has caused not only an oil shortage and energy crisis but also affected the supply and led to inflation across various products, including plastics, cosmetics, food items, and even alcoholic beverages.
India, although located thousands of miles from the conflict area, is still significantly affected by it. The country relies on imports for 90 percent of its crude oil, with half of this supply passing through the Strait of Hormuz, a critical chokepoint that has become central to the conflict.
India sources most of its LPG from Gulf countries, primarily Qatar and Saudi Arabia, which are among the most affected by the conflict.
Although the nation has announced an LPG shortage, international brewing companies in India have now cautioned about potential supply interruptions and price increases due to the gas scarcity.
How the conflict in Iran has contributed to increasing beer prices
A gas shortage leads to increased beer bottle costs, and shipping delays result in a scarcity of raw materials, such as aluminum, needed for production. According to Reuters, the Brewers Association of India, which comprises companies such as Heineken, Anheuser-Busch InBev, and Carlsberg, reported that the cost of glass bottles has increased by approximately 20 percent.
Gas continues to be a crucial resource necessary for the operation of furnaces and production lines. The assaults by Iran on Qatar's gas and oil infrastructure have somewhat hindered export capabilities, leading to a reduced supply of gas.
Consequently, the shortages have compelled numerous glass bottle manufacturers to either partially or completely cease their operations.
The impact on logistics has caused a disturbance in the supply of aluminum, potentially resulting in reductions. In addition to production issues, the packaging of the finished product has been affected, with an increase in the prices of paper cartons and other packaging materials like labels and tape.
Anticipated trends in pricing
Although Trump has proposed a truce, there is no definitive schedule for a potential de-escalation of the current conflict. The gas shortage and supply chain disruptions coincide with India's peak summer season, a time when beer sales usually increase.
Vinod Giri, the director general of The Brewers Association of India, informed Reuters that they are requesting price hikes between 12% and 15%, and have recommended that their member companies contact states individually.
Giri mentioned that the increasing production expenses are rendering 'some operations unsustainable.' There has been no formal statement from United Breweries, the Indian division of Heineken, nor from Anheuser-Busch InBev or Carlsberg.
Liquor sales in India have consistently increased, driven by urbanization and a wealthier population. Grand View Research estimates that the liquor market was valued at $7.8 billion (₹73,800 crore) in 2024, with expectations to double by 2030.
