Energy Secretary Chris Wright recently acknowledged what many analysts have been predicting: Americans shouldn’t expect gasoline prices to return to prewar levels anytime soon. Gas prices fell on Sunday to a national average of $4.05 a gallon, as detailed by the New York Times, a slight dip from a recent high of $4.17 earlier in April. Drivers are still paying about 36 percent more for gas than they were when the conflict first started. Diesel prices stand at $5.56, a 48 percent increase since the war began.
The dip came after a weekend of renewed conflict around the Strait of Hormuz, which dampened any hopes that the waterway might reopen soon. Oil prices shot higher and stock futures sank Sunday evening as traders digested developments that had unfolded after markets closed on Friday. The cease-fire between the United States and Iran is set to expire within days, now in its eighth week.
On Sunday, a U.S. Navy destroyer attacked and seized an Iranian-flagged cargo ship that President Trump stated had attempted to evade the U.S. blockade on ships traveling to and from Iranian ports. Just the day before, Iran reversed course after its foreign minister had declared the strait open, reasserting “strict control” over the waterway and attacking two Indian-flagged vessels. These developments have kept investors and analysts focused on the continued disruption to shipping in the Strait of Hormuz.
The global trade fallout is only getting worse
This narrow waterway between Iran and Oman normally carries as much as one-fifth of the world’s oil supply. Brent crude climbed more than 6 percent to around $96 a barrel, while West Texas Intermediate rose to around $88 a barrel. Futures on the S&P 500 pointed to a 1 percent decline when stocks open Monday, despite the index ending Friday 3.6 percent higher than before the war started.
About 20 percent of the world’s oil and liquefied natural gas typically moves through the Strait, and the disruptions are hitting global trade and supply chains broadly, per Dun & Bradstreet. Events that kicked off on February 28, 2026 caused a rapid downturn in container shipping activity connected to the Strait. The Strait also handles significant flows of petrochemicals, fertilizers, metals, and agricultural commodities alongside refined petroleum products and natural gas.
Maritime container booking data reveals that more than 44,000 businesses across 174 economies had at least one shipment exposed as of March 12. The highest concentrations of affected entities are in China, followed by the United Arab Emirates, Saudi Arabia, India, and Pakistan. The top ten countries account for about 55 percent of all impacted businesses.
Import bookings to the Persian Gulf region totaled 62,935 Twenty-Foot Equivalent Units (TEUs) in the seven days before the conflict began. That figure plummeted 70 percent to 18,663 TEUs in the following seven days, then fell a further 91 percent to 5,395 TEUs between March 16 and March 22. Cancelled import bookings skyrocketed 463 percent, from 17,374 TEUs in the pre-conflict week to 97,897 TEUs in the first week of fighting. Cancellations have declined somewhat since then, but remain higher than booking volumes.
Export activity from the region dropped over 60 percent immediately, from 20,804 TEUs before the conflict to 8,022 TEUs in the first week, then fell to 1,320 TEUs between March 16 and March 22. Export cancellations also rose substantially, from 2,732 TEUs in the pre-conflict week to 9,891 TEUs in the first week. Some shipments have been rerouted to Saudi ports in the Red Sea, where import bookings increased 68 percent and export bookings rose 86 percent between February 21 and March 22, though this covers only 50 to 60 percent of lost export volume and about 20 percent of lost imports when combined with Omani volumes.
Many vessels are now being diverted around the Cape of Good Hope, adding 10 to 14 days to already-strained transit times. By March 22, analysis showed that 7,716 businesses had experienced at least one shipment cancellation since February 28. Amid an emergency White House Situation Room meeting over the Strait closure, declining booking-to-cancellation ratios are becoming crucial early warning indicators of supply chain distress.
War-risk insurers are quickly suspending or cancelling coverage, or demanding prohibitively expensive premiums, often before any physical route closure. This makes transits commercially nonviable regardless of legal navigation rights. Cargo operators facing high fuel price sensitivity and limited hedging opportunities are seeing soaring costs, and the broader disruption is pushing up global freight markets with major carriers rerouting vessels around the Cape of Good Hope. Elevated freight rates are likely to persist across many trade lanes as long as the instability continues.
The consequences extend well beyond oil. Energy inputs sourced from the Gulf are cascading into the cost structures of nitrogenous fertilizer manufacturing, plastics, industrial inorganic chemicals, asphalt, cement, and steel production. Transportation sectors including railroads, marine shipping, and trucking are seeing sharp increases in diesel and bunker fuel costs. Trucking is particularly exposed, with fuel representing 35 to 40 percent of total operating costs. Food-related supply chains, including meat packing and wholesale grocery distribution, are also facing mounting costs tied to fuel, refrigeration, and logistics, amid broader disruptions to delivery networks that were already under pressure.
Wholesale trade leads among affected sectors, representing 27.49 percent of impacted businesses, followed by transportation services at 18.04 percent. Small and micro-businesses, those with fewer than 50 employees, make up about 80 percent of all disrupted entities. These firms often lack the financial buffers of larger organizations, and interruptions at this tier can quickly cascade into production delays for larger manufacturers that depend on specialized micro-suppliers.
Published: Apr 19, 2026 07:45 pm