Supply Chain Shock · Feb–Jun 2026
Energy Price Transmission: How Hormuz Closure Hits Everyday Costs
Causal chain from Strait of Hormuz blockade to household economic burden
Trigger — Feb 28, 2026
Strait of Hormuz Blockade
Iran closes 54km chokepoint carrying ~20% of global seaborne crude oil. All tanker traffic halts.
Immediate — Week 1
Crude Oil Price Spike
Global benchmark prices surge as supply contracts sharply.
WTI spike: rapid
Upstream Cost
Nitrogen Fertilizer Spike
Natural gas is fertilizer feedstock. Energy cost rise flows to farm inputs immediately.
+30%
Downstream — Transport
Transport & Logistics Costs
Public transit, air freight, shipping rates all rise as fuel costs climb.
+17% transit cost
Downstream — Food
Global Food Price Surge
Fertilizer cost → farm margin squeeze → crop price hike → grocery inflation with 6–10 week lag.
Global CPI: +1.2pp
Cumulative Impact — US Households (Feb 2025 – May 2026)
Combined Household Burden: Tariffs + War Supply Shock
$3,100+
Extra annual spending per US household
4.0%
G20 avg. inflation (vs 2.8% pre-war forecast)
6.0%
IMF worst-case inflation scenario if prolonged