'What’s the point of working any more?': Iranians in survival mode as food prices soar 400 per cent

Drought in Germany and Europe: The drier, the pricier Persistent drought conditions across much of Europe have triggered a cascade of economic impacts, including dried-up rivers, crop failures, and soaring transportation and food prices. As dry spells continue, experts warn that these developments could further fuel inflation, compounding existing pressures from global conflicts and energy market volatility. While exact figures on how much the drought will influence overall inflation remain uncertain, researchers agree the trend is clear and growing. The situation is particularly dire along major waterways such as the Rhine River, which serves as a critical route for transporting goods like diesel and heating oil. Torsten Schmidt, chief economist at the RWI Institute in Essen, notes that ships can now carry only a fraction of their usual cargo, significantly increasing transportation costs per ton. These higher expenses are passed directly onto consumers, contributing to the sharp rise in energy and food prices. According to the Food and Agriculture Organization (FAO), global temperature increases, extreme weather patterns, and declining harvests have all played a role in pushing up food prices. Since 2020, prices for meat and oilseed products have surged sharply, with current levels showing a roughly 30 percent increase compared to 2020. New studies suggest that climate change and extreme weather events are increasingly influencing inflation rates, adding to the challenges posed by supply chain disruptions caused by wars in the Middle East and Ukraine, as well as volatile energy markets. A study published in July 2025 titled "Climate extremes, food price spikes, and their wider societal risks" warns of a potential upward spiral in inflation, driven by frequent extreme weather events making food prices both domestically and internationally more volatile. The research involved five European research institutions and the European Central Bank (ECB), highlighting concerns that central banks may struggle to maintain stable pricing as weather-related shocks become more frequent. The report suggests that such volatility could impact not only individual countries but also the broader European Union, as price changes in one region affect inflation trends elsewhere. The ECB itself released a similar analysis in 2023 titled "The asymmetric effects of weather shocks on Euro area inflation," examining the four largest economies within the EU. It found that the frequency and intensity of extreme weather events in Europe could lead to sustained upward pressure on inflation. The report also noted that different regions experience varying degrees of impact depending on seasonal factors and local conditions, potentially widening inflation disparities among member states. As of June 2026, inflation rates across the EU ranged from as low as 2 percent in France to nearly 5.4 percent in Lithuania. Germany recorded an inflation rate of 2.4 percent, slightly below the EU average of 2.8 percent. Transportation costs, which have risen by over 5 percent, stand out as a key driver of inflation, reflecting the ongoing strain on logistics networks affected by the drought. Meanwhile, in Iran, the economic fallout of the ongoing conflict with the United States has intensified food shortages and inflation, with some staple prices climbing by over 400 percent. Citizens like Nima, a cryptocurrency trader, report having to ration basic necessities, struggling to afford non-essentials like electronics or dining out. Unemployment has reached a four-year high of 9.1 percent, exacerbating the hardship faced by ordinary citizens. The Iranian rial has lost nearly half its value against the U.S. dollar, reaching close to 1.88 million to the greenback, up from 1.65 million prior to the conflict. With negotiations for a renewed framework agreement set to expire soon, the outlook for economic stability remains bleak. Many Iranians are considering migration as a last resort, though few can afford it. Amid the crisis, some individuals are even forgoing essential medical care due to rising healthcare costs, underscoring the deepening humanitarian impact of prolonged economic instability.