Energy markets under chokepoint stress: the 2026 Hormuz shock

In this paper, we analyze the energy-market consequences of the 2026 Middle East conflict and the associated disruption of traffic through the Strait of Hormuz. The conflict created the largest physical supply disruption in the history of global energy markets, with effects extending beyond crude oil to refined products, petrochemical feedstocks and liquefied natural gas. Energy prices rose sharply, but less than the scale of the physical disruption alone would have suggested, thanks to high pre-war inventories, emergency stock releases, the rerouting of commodity flows, and demand compression. The shock was global but differed from previous energy shocks along several dimensions: its unprecedented size, its propagation across refined product markets, the asymmetric exposure of Asian and European importers, and its uncertain persistence (especially regarding the restoration of Hormuz flows and damaged infrastructure). Compared with the 2021-22 European energy crisis, the events of 2026 affected oil and gas more homogeneously and were more global than regional. Our analysis covers developments up to 30 June 2026 and therefore provides an assessment of the initial phase of an ongoing shock rather than of the episode as a whole.