The escalation around the Strait of Hormuz is rippling far beyond the Middle East, with economists, shippers and energy officials warning that the fallout is already feeding through to prices, trade flows and business planning.
At a briefing at the Port of Los Angeles, Jerrold D. Green, a senior fellow on the Middle East and South Asia, said the conflict had altered the strategic environment in ways that would not be easily reversed. He described the situation as global rather ...
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than regional, arguing that businesses were being forced to make decisions in an atmosphere of deep uncertainty. Port chief executive Gene Seroka said the disruption was already affecting shipping costs and cargo movements, even if freight arriving at the West Coast port had so far held near seasonal norms.
The main pressure point remains the Strait of Hormuz, one of the world’s most important energy corridors. Before the war, roughly 100 to 110 vessels passed through the waterway each day, carrying a significant share of global oil trade. Since the fighting began, thousands of ships have been unable to move east or west through the route, and Seroka said the price of fuel for cargo vessels had doubled in six weeks. Consumers are also feeling the effect through higher petrol prices, with AAA reporting that the US national average had risen sharply from pre-war levels.
The wider impact is now showing up in official forecasts. The International Monetary Fund has cut its global growth outlook for 2026, warning that the conflict has disrupted economic momentum and revived inflationary pressures. The fund said its forecast assumes the fighting remains relatively contained and oil prices stabilise, but it also cautioned that the recovery could prove more difficult than after the 2022 energy shock.
Energy demand is also being revised lower. The International Energy Agency now expects global oil demand to fall in 2026, the first such decline since the pandemic, as higher prices curb consumption and supply disruptions continue to bite. The agency said shipments through Hormuz have fallen dramatically from pre-war levels, and it has not ruled out further releases from strategic reserves.
Retailers in the United States are not direct buyers of much Middle Eastern merchandise, but supply chain groups say the region still matters because global logistics are tightly interconnected. Jonathan Gold of the National Retail Federation said rerouted vessels, displaced equipment, higher fuel bills and rising pump prices all feed into the same system, leaving consumers with less spending power.
Green warned that the disruption could last well beyond the fighting itself. Rebuilding damaged infrastructure, he said, would be more expensive because future projects would need stronger protection. He also pointed to knock-on effects for pharmaceutical production, remittance flows from Gulf workers and energy supplies in Asia, where countries such as Vietnam rely heavily on fuel moving through the strait.
For now, Port of Los Angeles officials say trans-Pacific trade continues to move without major interruption, helped by shipping terminals in the Middle East keeping cargo segmented and flowing. But with the diplomatic track stalled, military tensions unresolved and energy markets still on edge, businesses are bracing for a longer period of instability.
Source: Noah Wire Services
