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this post was submitted on 19 May 2026
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It doesn't- demand destruction and economic recession is the result.
Reserves are being drawn at a crazy rate right now to compensate for Hormuz being closed, but that will collapse by the end of June and there will be some huge price spikes and physical shortages. The world economy will need to contract by 5% or more to stop using the oil lost by Hormuz until alternative pipllelines open, supply chains begin de-fossilizing, and alternstive supplies take up the slack with multi year leadtimes.
Next two years are gonna be really fucking bad.