Iran’s war reshapes global energy economics after six months

Six months into the US-Israel military campaign against Iran, the global energy economy looks fundamentally different than it did in February. Brent crude has stabilized between $86 and $93 per barrel, roughly 25% above pre-war levels, and fossil fuel importers worldwide have collectively absorbed more than $330 billion in extra costs since the first airstrikes landed on February 28. The blockade math The Strait of Hormuz, the narrow waterway connecting the Persian Gulf to open ocean, has become the conflict’s economic chokepoint. Iran’s effective blockade of the strait has sharply curtailed crude and liquefied natural gas exports from the entire Gulf region, not just Iranian barrels. For context, roughly a fifth of the world’s petroleum passes through that corridor in peacetime. Dueling blockades and shipping hazards have turned it into something closer to a no-go zone, forcing exporters to find alternative routes or simply produce less. Gulf nations that depend on oil revenue are also feeling the squeeze. Reduced export volumes mean that even elevated prices have not fully compensated for lost sales, weakening fiscal positions across the region. Winners and losers China stands ou...