Hormuz blockade could deepen world’s worst energy crisis — and risk a
Lightning occurs when META 4, an Oil Products Tanker, sails into Muscat Anchorage on March 21, 2026 at Sultan Qaboos Port in Muscat, Oman.
Elke Scholiers | Getty Images
President Donald Trump ordered a naval blockade of the Strait of Hormuz on Sunday, dimming hopes for a quick end to the conflict in the Middle East and escalating a standoff with Iran that has already triggered the worst energy shock in history.
The blockade would take effect at 10 a.m. ET Monday, targeting vessels of all nations entering or departing Iranian ports and coastal areas, including those on the Arabian Gulf and Gulf of Oman, the U.S. Central Command said in a statement.
Tanker traffic through the strait, which had begun to inch higher after a two-week ceasefire announced by Trump last week, came to a halt again within hours of Trump’s announcement, according to Lloyd’s List Intelligence. At least two vessels that had appeared to be heading for the exit turned back.
Crude oil surged as investors scrambled to price in a further squeeze on Persian Gulf supply. U.S. WTI futures for May delivery jumped more than 8% to $104.40 a barrel, while Brent crude rose over 7% to $101.86.
Trump’s order came after 21 hours of weekend negotiations between Washington and Tehran collapsed without an agreement on Iran’s nuclear program, control of the waterway, and Israel’s continued attacks against the Iranian-backed Hezbollah in Lebanon.
Deepening the oil shock
Before the opening strikes by the U.S. and Israel against Iran on Feb. 28, roughly one-fifth of the world’s oil passed through the Strait of Hormuz. That flow has since slowed to a trickle, upending supply chains for oil, fertilizers, apparel and industrial goods. Analysts have warned that clearing the backlog could take weeks even after a resolution.
A full blockade would further tighten the squeeze. “Taking more oil off the market — particularly the only oil that is now getting out from the Persian Gulf — will drive oil prices further up … [to] around $150 per barrel,” Trita Parsi, executive vice president of the Quincy Institute for Responsible Statecraft, said on CNBC’s “The China Connection” on Monday.
Since neither side has explicitly stated that talks won’t resume or that the ceasefire is over, all these moves should be treated as tactics and threats within the negotiations.
Trita Parsi
Executive vice president, Quincy Institute for Responsible Statecraft
Besides crude, commodity prices for fertilizer and helium — critical inputs for food production and semiconductor manufacturing — are likely to keep climbing, fanning inflation that is already accelerating, said Ben Emons, managing director at Fed Watch Advisors.
The IMF and World Bank officials last week signaled they would downgrade global growth forecasts and raise inflation projections, warning that emerging markets would be hit hardest.
“The economic scarring from attacks on energy facilities and ports in Iran and other Gulf nations could continue to keep supply…
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