Chief Fatih Birol Warns Hormuz Disruption Could Hit Economies Within Weeks

The global economy could face significant disruptions if the ongoing crisis in the Strait of Hormuz is not resolved within weeks, International Energy Agency (IEA) Executive Director Fatih Birol has warned. Speaking on the sidelines of the Aspen Security Forum in Colorado, Birol said uncertainty surrounding the strategic waterway has heightened concerns across global energy markets. The Strait of Hormuz is one of the world's most critical shipping routes, carrying a substantial share of global oil, natural gas and other essential commodities.

Birol said financial and commodity markets remain nervous as escalating attacks in and around the Strait of Hormuz threaten the uninterrupted movement of oil, fertilisers, liquefied natural gas and commercial cargo. According to him, prolonged disruption of shipping through the narrow maritime corridor could have serious consequences for economies worldwide, particularly those that rely heavily on energy imports. He stressed that the waterway must be reopened fully and unconditionally before the situation causes broader economic damage.

Shipping activity through the Strait has declined sharply over the past week following attacks on vessels and the reimposition of a US blockade targeting Iranian shipping. Saudi Arabian oil exports from terminals located within the Persian Gulf have also reportedly fallen after strikes involving supertankers. Meanwhile, the International Maritime Organization has stated that commercial navigation through the Strait remains unsafe due to ongoing security threats, further affecting global supply chains.

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The IEA chief cautioned that the world does not have the luxury of waiting months for a resolution. He said the Strait must return to normal operations within weeks to prevent renewed strain on the global economy. Extended disruptions could lead to tighter energy supplies, higher transportation costs and increased inflationary pressures, particularly for countries dependent on imported fuel and industrial feedstocks.

Birol noted that while developed economies such as South Korea and Japan have already experienced the effects of disrupted energy shipments, several developing nations are even more exposed to prolonged supply interruptions. He specifically identified Bangladesh, Pakistan and India as countries that could face greater economic challenges if oil and gas deliveries through the Strait remain restricted, given their significant reliance on imported energy.

The Strait of Hormuz serves as one of the world's most strategically important maritime chokepoints, linking major oil-producing Gulf nations with international markets. Any sustained interruption to shipping through the route has the potential to influence global energy prices, trade flows and economic stability. As geopolitical tensions continue to evolve, governments and industry leaders are closely monitoring developments, with the timely restoration of safe commercial navigation viewed as essential to maintaining global energy security.

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