Danish supermarkets brace for second wave of price hikes linked to Middle East conflict

Danish consumers may soon see grocery prices rise as supermarkets prepare for a new round of inflation driven by the Middle East conflict, according to an analysis by Danish Broadcasting Corporation (DR) based on fresh data from Danmarks Statistik.

The latest business survey reveals a shift in expectations: after months of anticipating price declines, retailers now foresee higher costs for shoppers. The turnaround follows months of falling food prices, with inflation at 1.2% in the most recent report—though fuel costs have already surged due to disrupted oil supplies.

Nearly 20% of global oil and gas shipments pass through the Strait of Hormuz, which Iran has effectively blocked amid the conflict. While the International Energy Agency—including Denmark—released emergency oil reserves to stabilize markets, analysts warn the crisis could worsen, potentially leading to fuel shortages rather than just price spikes.

Oil prices have climbed nearly 60% since January, with fluctuations tied to geopolitical developments. Energy costs ripple through the economy quickly, as businesses typically pass on 84% of their higher energy expenses to consumers, according to past research by Denmark’s Environmental Economic Council.

The first wave hit fuel pumps almost immediately, with gasoline reaching around 16 DKK per liter. A second, broader wave may now lift grocery prices as producers—particularly those without fixed-price energy contracts—face rising costs for transportation, heating, and plastic-based products.

While Denmark’s National Bank expects modest wage growth (3.4% this year) and recent policy measures like the removal of electricity taxes have eased some pressure, economists caution that prolonged energy price hikes could outweigh these gains. The full impact on supermarket shelves remains uncertain.