Global oil flow disrupted amid Iran tensions and attacks on ships

Global trade routes are currently experiencing severe disruptions, particularly in the strategically vital Strait of Hormuz, due to an ongoing conflict involving Iran, the United States, and Israel. Since February 28, 2026, Iran has largely blocked the Strait in response to US-Israeli air attacks, with its Revolutionary Guard Corps issuing warnings, boarding and attacking merchant ships, and deploying sea mines. This escalation has led to a dramatic decrease in shipping traffic, with volumes approximately 70% below pre-conflict levels as of mid-October 2026, forcing major shipping lines to reroute vessels and significantly increasing maritime insurance premiums.

The disruptions have intensified recently, with a surge in attacks on commercial vessels in the Strait of Hormuz. In the week leading up to October 17, 2026, at least 10 vessels were reportedly attacked, and two cargo ships have sunk in separate incidents. These actions have severely impacted global oil flow through the strait, which normally handles a significant portion of the world's seaborne oil and liquefied natural gas (LNG) trade.

The ongoing instability in the Strait of Hormuz has triggered a global fuel crisis, with Brent crude oil prices surpassing $100 per barrel and reaching peaks of $126, marking the largest disruption to world energy supply since the 1970s. The economic repercussions extend beyond energy, affecting commodity markets like fertilizers and raising widespread concerns about global inflation, stagflation, and a potential recession. Tragically, these events have also resulted in at least 25 seafarer fatalities near the strait.