The UN trade and development agency has warned that while the reopening of the Strait of Hormuz will bring immediate relief to energy markets, vulnerable economies remain at risk from prolonged increases in food and fuel costs, Reuters reports.

Food and transport systems are likely to take longer than energy markets to recover, as disrupted supply chains need more time to reset following more than 100 days of severe disruption to shipping through the strategic waterway, a UN Conference on Trade and Development said in a new report.

Although Brent crude has fallen sharply back to around $73 a barrel, close to pre-conflict levels, following the interim US-Iran agreement, UNCTAD said higher fuel, gas and fertiliser costs could continue to feed through into agricultural production, transport costs and household budgets.

Vulnerable economies remain particularly exposed to oil and fertiliser price shocks, while persistently high food prices could place further pressure on poorer households. UNCTAD said a 5 per cent increase in food prices can significantly raise the risk of childhood wasting.

The agency identified 61 vulnerable economies exposed to oil and cereal import shocks linked to the Strait of Hormuz disruption.