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Such spikes would ripple far beyond energy. U.S. gasoline prices could climb to $4.50-6+ per gallon quickly, fueling inflation and pressuring consumer spending. Globally, higher energy costs would hit transportation, manufacturing, and heating, exacerbating supply-chain strains. Asian importers like China, India, Japan, and South Korea—dependent on Gulf crude—face acute vulnerabilities; India’s refiners, for instance, could see immediate cost surges. Shipping insurance rates have already tripled in some cases, with war-risk premiums soaring. LNG prices could quadruple in spot markets, hitting Europe and Asia hard amid ongoing energy transitions.
Economists warn a sustained Hormuz closure guarantees recessionary pressures: Oxford Economics models modest disruptions pushing Brent to $84, but full blockade scenarios evoke parallels to the 1973 oil embargo or worse. Global growth could stall, stock markets tumble (energy stocks might initially rally, but broader equities suffer), and safe-haven assets like gold and Treasurys surge.
Tehran views itself on “death ground,” per former NATO assessments, potentially prompting “go big” retaliation: beyond Hormuz, cyberattacks, terrorism against U.S. interests, or strikes on neighbors’ oil facilities. Yet self-preservation tempers action—Iran’s economy relies on oil exports, and full closure invites devastating U.S. counterforce.
As of late February 28, 2026, the strait sees reduced but not zero traffic; some vessels transit cautiously, while others pile up waiting. No confirmed military interdictions or attacks on ships yet, but the psychological effect is profounThe world watches anxiously: will this remain asymmetric harassment, or spiral into open naval confrontation?
