Volatility in global oil markets could significantly increase the cost of manufacturing essential medicines and expose vulnerabilities in pharmaceutical supply chains, according to a July Unitaid report.
Here are five things to know:
- Researchers estimated that if crude oil prices rose from $75 to $125 per barrel, manufacturing costs for tenofovir disoproxil fumarate/lamivudine/dolutegravir (TLD) could increase by 44%, driven largely by higher prices for fossil fuel-derived active pharmaceutical ingredient inputs.
- More than 24 million people were receiving TLD globally as of 2024, according to the report, making the regimen one of the most widely used HIV treatments and particularly vulnerable to oil price shocks.
- Pharmaceutical manufacturing relies heavily on fossil fuel-derived chemicals and energy, with petroleum used to produce many active pharmaceutical ingredients, solvents, reagents and packaging materials. The authors said those dependencies expose medicine production to fluctuations in oil markets.
- Researchers said geopolitical instability, supply disruptions and long-term declines in conventional oil production could contribute to greater price volatility, creating risks for medicine affordability and supply security, particularly in low- and middle-income countries.
- The report recommends diversifying feedstocks, investing in greener manufacturing technologies and strengthening supply chain resilience to reduce the pharmaceutical sector’s dependence on fossil fuels and improve long-term medicine access.
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