Impact of US-Iran Conflict on India's Beer Prices and Supply Chains

The US-Iran conflict, now in its 30th day, is causing significant disruptions in supply chains and inflation in India, particularly affecting beer prices. With rising production costs due to gas shortages and logistical challenges, major brewers are warning of potential price hikes. As India approaches peak summer, the Brewers Association is advocating for price increases of 12-15%. The liquor market, valued at $7.8 billion in 2024, is expected to grow, but the ongoing tensions pose challenges for the industry. Read on to discover the full impact of this conflict on India's beer market.

By Narendra Chaudhary Mar 27, 2026, 17:02 IST

Overview of the US-Iran Conflict's Effects

The ongoing conflict between the US and Iran has now reached its 30th day, extending its effects beyond the battlefield. This situation has not only led to oil shortages and energy crises but has also disrupted supply chains and increased inflation across various sectors, including plastics, cosmetics, food, and alcoholic beverages. Although India is geographically distant from the conflict, it is experiencing significant repercussions. The nation imports about 90% of its crude oil, with nearly half of it transiting through the Strait of Hormuz, a crucial chokepoint now under pressure due to the ongoing tensions. Additionally, India heavily depends on Gulf countries for LPG imports, particularly from Qatar and Saudi Arabia, both of which are significantly affected by the conflict. Reports of LPG shortages have emerged, and global brewers in India are now cautioning about potential supply disruptions and escalating costs due to gas shortages.

Reasons Behind Rising Beer Prices

Why Beer Prices Are Rising

Gas shortages have led to increased production costs, especially for glass bottles, while logistical challenges have delayed the supply of essential raw materials like aluminum. The Brewers Association of India, which includes major companies such as Heineken, Anheuser-Busch InBev, and Carlsberg, has reported a nearly 20% increase in glass bottle prices. Gas is essential for operating furnaces and maintaining production lines. Attacks on Qatar’s oil and gas infrastructure have partially disrupted export capabilities, tightening global supply. Consequently, several glass manufacturers have had to reduce or temporarily cease operations. Furthermore, logistical issues have adversely affected aluminum availability, and packaging costs—including paper cartons, labels, and tapes—have also surged, compounding the overall production challenges.

Future Expectations Amidst Ongoing Tensions

What To Expect Next

Despite ongoing calls for a ceasefire, a clear timeline for de-escalation remains elusive. The supply shortage coincides with India's peak summer season, a period that typically sees increased beer consumption. The Brewers Association of India has requested price increases ranging from 12% to 15%, urging member companies to approach state authorities individually. Director General Vinod Giri has indicated that rising production costs are rendering some operations 'unsustainable.' So far, there has been no official response from major brewers like United Breweries, Anheuser-Busch InBev, or Carlsberg. India's liquor market, projected to be worth $7.8 billion (₹73,800 crore) in 2024, has been steadily growing, fueled by urbanization and rising incomes, with industry estimates suggesting the market could potentially double by 2030.