Beer fans could soon be paying more at the checkout as the ongoing conflict involving Iran continues to disrupt global supply chains and drive up the cost of doing business.

While brewers have already spent the past few years dealing with inflation, higher labor costs and soft beer sales, the latest geopolitical crisis is creating yet another challenge. Rising energy prices, shipping delays and more expensive raw materials are making it harder and costlier to brew and package beer.

According to the Wall Street Journal, one of the biggest concerns is aluminum. Beer cans remain the preferred package for most American breweries, and disruptions to trade through the Strait of Hormuz have tightened supplies and increased costs for aluminum producers and can manufacturers. Even though aluminum prices have eased somewhat from their earlier highs, they remain vulnerable to renewed fighting and shipping disruptions.

Fuel is another major issue. Oil prices surged after the conflict intensified, raising transportation costs across the board. Beer is expensive to move because it’s heavy, so higher diesel prices quickly translate into larger freight bills for breweries, distributors and retailers. Although crude prices have recently pulled back from their peak, they remain well above prewar levels and markets continue to react to developments in the region.

The conflict is also affecting agriculture. Fertilizer costs have climbed as shipping routes remain disrupted, putting additional pressure on farmers growing barley and wheat, two of beer’s most important ingredients. Those higher costs eventually work their way through the brewing supply chain.

Some of the industry’s largest companies have already acknowledged the impact. The Boston Beer Company, maker of Samuel Adams, has cited higher commodity costs, including aluminum, as one reason for raising prices. Packaging suppliers have also increased prices as freight and raw material costs continue to rise.

Unfortunately for brewers, this is happening at a time when consumers are already cutting back. Higher fuel bills and everyday living expenses are leaving many Americans with less disposable income, making beer an easy place to trim spending. That creates a difficult balancing act for breweries that need to raise prices just as many drinkers become more price conscious.

For an industry that’s already facing slowing sales and razor-thin margins, the conflict in the Middle East has become yet another reminder that events happening thousands of miles away can have a very real impact on the price of a beer here at home.

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