In previous decades, an energy shock of this scale would likely have pushed the global economy into a deep recession, triggering market panic and surging inflation. Yet despite the closure of the Strait of Hormuz and the loss of millions of barrels of oil from global supply, major economies continue to show notable resilience.
The disruption is already being described as the most severe since the 1970s, but markets have not collapsed, economic activity remains broadly intact and investment continues at relatively high levels. This marks a clear contrast with earlier energy crises, when the impact on growth and consumption was immediate and severe.
Impact of the Hormuz blockade
The closure of the Strait of Hormuz has removed around 13 million barrels of energy supply per day from the market, placing pressure on transport, industry and consumption.
Blackouts, fuel rationing and energy restrictions have already been reported in some regions, while governments and businesses are adjusting to a high-cost environment. Brent crude prices have risen by at least 50% since the start of the conflict, raising concerns about renewed inflation and slower growth.
The longer the disruption persists, the higher the risk of recession, particularly for energy-dependent economies.
Reserves and efficiency buffer the shock
One key reason for the global economy’s resilience is the existence of substantial strategic energy reserves.
At the start of the year, Japan and South Korea held reserves covering roughly 200 days, Europe around 130 days and China close to 100 days. These запасes act as a cushion, limiting immediate supply shocks and reducing panic in energy markets.
Improved energy efficiency also plays a role. Since 2000, the energy required to produce one unit of GDP has fallen significantly in major economies, allowing them to absorb part of the shock more effectively.
Role of technology and renewables
Investment in artificial intelligence is providing additional support to global economic activity. Rapid growth in sectors such as data centres, semiconductor production and digital infrastructure has created a new cycle of investment, particularly in Asia.
Strong demand for technology exports is offsetting part of the pressure caused by higher energy costs.
At the same time, renewable energy is playing an increasingly important role. Greater reliance on renewables, more efficient appliances and modernised industrial processes have reduced the energy intensity of economic activity in many advanced economies.
Risks remain
Despite current resilience, risks remain significant. If the closure of the Strait of Hormuz continues into next year, global growth could drop to around 2%.
The greatest strain is already being felt in poorer countries, which lack reserves, fiscal flexibility and access to investment flows linked to technology. In these economies, energy shortages are forcing factory shutdowns, while higher import costs are placing heavy pressure on public finances.
Central banks, however, are acting more cautiously than during the 2022 energy crisis, when inflation triggered aggressive interest rate increases. Policymakers are now assessing whether the rise in energy prices will prove temporary or more sustained.
How much can the economy absorb?
Economists are increasingly questioning how long the global economy can withstand successive shocks without long-term damage.
The pandemic, energy disruptions and geopolitical tensions have already weakened investment, reduced business confidence and limited fiscal space.
While the global economy continues to show resilience, the duration of the current crisis is likely to determine whether it can hold steady or slide into a new phase of slowdown.
