Iran Blockade of Hormuz Strait Triggers Global Energy Crisis

The Government of Iran established a de facto blockade of the Strait of Hormuz starting February 28, 2026, in retaliation for U.S. and Israeli airstrikes. The closure has virtually halted shipping traffic, with daily tanker crossings dropping from 46 pre-war to fewer than two in March. This disruption has removed over 14 million barrels per day from the global supply, triggering the largest energy crisis in history and causing surges in oil, gasoline, and fertilizer prices.

On May 20, the Iranian-led Persian Gulf Strait Authority claimed regulatory jurisdiction over the waterway extending into United Arab Emirates waters, requiring authorization for transit. The UAE rejected these claims as a pipe dream. In response to the blockade and Iranian sovereignty claims, the UAE is fast-tracking the West-East Pipeline through Fujairah port to double ADNOC's export capacity by 2027. The UAE also exited OPEC on May 1 to increase global oil supply.

International Energy Agency Executive Director Fatih Birol warned that global markets may enter a red zone in July or August as strategic reserves are exhausted and summer demand peaks. Sultan Al Jaber, CEO of ADNOC, noted that full oil flows will not return until 2027, even if the conflict ends immediately. Beyond energy, the blockade has caused a global fertilizer crisis, leading the European Commission to launch a Fertiliser Action Plan and Australia to underwrite overseas shipments to secure domestic supplies.