A conflict in an oil-producing region can push up the price of crude within hours. Within days, financial markets begin reassessing inflation forecasts, energy companies adjust their expectations, airlines face higher fuel bills and investors reconsider the outlook for interest rates. Over the following months, the consequences can spread through freight networks, food production, manufacturing and consumer spending.
For decades, globalisation operated on a relatively straightforward principle: companies would manufacture products wherever they could do so most efficiently, source components from the most competitive suppliers and sell to the largest available markets. Capital flowed across borders, supply chains stretched around the world, and businesses built their strategies around cost, productivity and access to consumers.