For months, most people expected the Strait of Hormuz disruption to end quickly through talks or military pressure. But global ratings agency Moody’s is now saying something very different. In a new report, Moody’s warned that what started as a short-term shipping crisis is quickly turning into a long-term structural problem that could permanently change how the world trades, prices energy, and plans its supply chains well beyond 2026.
Shipping Through Hormuz Has Dropped by Over 90 Percent
The Strait of Hormuz carries around one fifth of all global oil and gas shipments. That makes it one of the most important trade routes on the planet. But since the conflict began, shipping through the strait has fallen by more than 90 percent compared to normal levels. Insurance costs have gone through the roof, shipping companies are avoiding the area completely, and sea mines continue to make navigation very dangerous for vessels of all types.
Oil Prices Between $90 and $110 a Barrel — Possibly for a Long Time
Moody’s now expects Brent crude oil prices to stay between $90 and $110 a barrel for most of this year. That is much higher than earlier predictions. For everyday people, this means higher fuel bills, more expensive flights, costlier goods in shops, and rising inflation. The agency also warned that even if a ceasefire happens tomorrow, things will not go back to normal overnight. Shipping backlogs, tanker repositioning, and insurance markets could take many months to stabilise fully.
Airlines, Retail and Manufacturing Are Under the Most Pressure
Moody’s identified airlines, chemicals, and building materials companies as facing the greatest strain right now because their costs are rising fast and they cannot easily pass those costs on to customers. Retail, hospitality, and manufacturing businesses are also feeling the pressure as households cut back on spending. On the other hand, energy producers outside the Gulf and defence companies are actually benefiting from higher oil prices and increased global tensions.
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Final Thoughts
The Moody’s report sends a clear message — the world cannot keep waiting for the Strait of Hormuz to go back to normal. Governments, businesses, and everyday people are already adjusting to higher costs and a new way of doing things. The smarter move now is to adapt, plan ahead, and stay informed.
