"Approaching Pandemic-Level Shortages" — The Shock Has Begun

Ajouté : 2026-05-12

[00:00:00]For weeks, investors wanted to believe the Iran crisis was under control.

[00:00:04]They wanted to believe oil would keep moving, gas prices would come down, and the Strait of Hormuz would reopen before the damage became too serious.

[00:00:12]But that confidence is now starting to crack. The Dow plunged by more than 550 points after Iran renewed attacks across the Gulf region, and oil prices climbed again as markets reacted to the possibility that this crisis may last longer than expected.

[00:00:28]And this is the key point. The issue is no longer just fear. It's no longer just headlines.

[00:00:34]The issue is that the world may now be moving from a price shock into a supply shock. When prices rise, people can complain, cut back, and wait for relief.

[00:00:43]But when actual shortages begin, the problem becomes much harder to manage.

[00:00:48]And this is why the story matters so much because what started as an oil market crisis could now become a much wider supply chain crisis.

[00:00:58]Take a look at this clip where they explain the immediate market reaction after Iran launched a new wave of attacks across the Gulf region.

[00:01:06]And it's time now for money, power, politics. And for the first time in weeks, investors are reining in their optimism over the war in Iran. The Dow plunged more than 550 points, and oil prices climbed after Iran launched a new wave of attacks across the Gulf region, as we mentioned. According to the US military, Iran fired on American ships in the Strait of Hormuz, but the missiles and drones were intercepted, and no ships were hit. The UAE also said that an Iranian attack caused a fire in the largest oil storage area in the Emirates. Meanwhile, here in the US, the last California-bound oil tanker to pass through the Strait of Hormuz has arrived in Long Beach just in time for the average price for a gallon of gas to reach nearly $4.50.

[00:01:49]The reason that clip matters is because it shows how quickly the mood changed.

[00:01:53]Markets had spent weeks acting as though the worst-case scenario would be avoided. But once Iran renewed attacks across the Gulf, investors suddenly had to face a more serious possibility.

[00:02:04]What if the Strait of Hormuz does not reopen quickly?

[00:02:07]What if this is not a short-term disruption?

[00:02:10]What if the world is entering a period where key goods don't just become more expensive, they actually become harder to get?

[00:02:18]That's the difference between inflation and shortage. Inflation hurts because prices rise. Shortage hurts because supply disappears. And when supply disappears in a global economy, the pain doesn't stay in one place. It spreads through shipping, fuel, food, manufacturing, hospitals, technology.

[00:02:35]Reuters reported Chevron chairman and CEO Mike Wirth said on Monday that physical shortages in oil supply would begin appearing around the world because of the closure of the Strait of Hormuz, through which 20% of global crude supply passes.

[00:02:50]Economies will be shrinking first in Asia as demand adjusts to reduced supply with the Strait still closed because of the US-Israeli war with Iran.

[00:02:59]Wirth said during a discussion sponsored by the Milken Institute, "We'll start to see physical shortages," Wirth said, noting that surplus supply in commercial markets, tankers in so-called shadow fleets avoiding sanctions, and national strategic reserves were being absorbed.

[00:03:15]"Demand needs to meet to meet supply," he said. "Economies are going to have to slow."

[00:03:21]This is important because it changes the whole story. This isn't just about expensive oil anymore. This is about whether there's enough oil reaching the countries, factories, airlines, refineries, and shipping companies that depend on it.

[00:03:34]When Mike Wirth says demand needs to meet to meet supply, what he's really saying is that the world may have to slow down because the fuel needed to keep the economy moving is becoming harder to access.

[00:03:44]Asia would feel it first because Asia depends heavily on oil and refined products from the Gulf. Europe could be next, and eventually even the United States could feel the pressure. Even though America is more protected because it produces and exports more of its own crude.

[00:04:00]This is why the last scheduled Gulf oil shipment arriving in Long Beach matters.

[00:04:05]It shows that the delayed effect is now reaching American shores.

[00:04:09]Oil does not teleport from the Gulf to the West Coast. It takes time. So, a crisis can look manageable for a few weeks and then suddenly the shortage begins to appear.

[00:04:18]And this is where the story becomes bigger than petrol prices.

[00:04:21]A lot of people hear oil crisis and immediately think about filling up their car. But the Strait of Hormuz is not just a fuel route. It's one of the most important trade choke points in the world. If that route's disrupted, it doesn't only affect crude oil. It affects gas, chemicals, fertilizers, metals, industrial materials, and the imports needed for modern manufacturing.

[00:04:43]That's why the phrase pandemic-level shortages is so serious.

[00:04:47]During the pandemic, the problem was not simply that things became expensive. The problem was that certain goods were missing. Factories couldn't get parts.

[00:04:54]Shipping routes were clogged. And businesses had to slow down because one missing input could stop a whole production line.

[00:05:02]Take a look at this clip where Ron Insana explains why Wall Street is finally reacting more seriously and why this crisis may be moving toward pandemic-level shortages.

[00:05:13]Given the situation in Iran, what's your take?

[00:05:16]Well, I think the you know, the re-escalation military action to shock Wall Street and you think as you said earlier in the program that this is just going to be done sometime soon because they're getting hints from the White House that everything's under control, that gas prices are going to come down, that oil's going to start flowing through the strait again. And with this new military altercation between Iran and the UAE firing on US ships, that calls that entire line of reasoning, if you will, into question. And so, as you also noted with that last ship getting to port in in in Los Angeles, we now have months to wait for oil to make it around the world because it takes quite a long time for oil tankers to leave the strait and get to their ultimate destination. So, yeah, this is finally a recognition that we're approaching, you know, pandemic-level shortages of certain goods.

[00:06:02]>> This clip's important because it explains the psychology of the market.

[00:06:06]Investors have been hoping that this would be over quickly. They were listening to reassurance from officials and assuming that oil would soon start flowing normally again.

[00:06:15]But renewed military action changed that calculation.

[00:06:19]Once attacks continue, once ships are threatened, and once oil tankers have to reroute or wait, the market starts asking a different question, not how high will oil go today, but how long can the global economy keep functioning normally if the supply chain's blocked?

[00:06:35]That's a much more serious question because if the answer's weeks or months, then the problem moves beyond petrol stations. It reaches aviation, agriculture, factories, hospitals, computer chips, all sorts of things.

[00:06:48]The World Economic Forum reported the shipping crisis in the Strait of Hormuz is now the largest supply disruption in the history of the global oil market, according to the head of the International Energy Agency, Fatih Birol.

[00:07:02]While focus remains on the 11 million barrels of oil and 140 billion cubic meters of gas usually in daily global circulation, the impact extends far beyond energy.

[00:07:13]As the conflict in Iran continues, the blockage also exposes a deeper vulnerability, the Middle East's role as a primary supplier of non-oil commodities.

[00:07:23]From the fertilizers essential for global food security to the minerals powering the energy transition, the current shortages are reshaping supply chains in real time.

[00:07:33]These are not random commodities that only matter to traders on a screen.

[00:07:37]Fertilizer matters because farmers need it to grow food. Sulfur matters because it's used in fertilizer production, battery processing, and industrial chemicals. Methanol matters because it feeds into plastics, paints, coatings, synthetic fibers. Aluminum matters for construction, transport, packaging, renewable energy. Helium matters for hospitals and chip factories.

[00:07:59]So, when the Strait of Hormuz is disrupted, the real risk is not just that drivers pay more at the pump. The real risk is that costs start moving through the entire economy.

[00:08:09]Fertilizer is one of the clearest examples. If fertilizer prices rise today, the full impact may not show up immediately in the supermarket, but farmers feel it when they buy inputs. If farmers pay more to grow crops, those costs can eventually move into food prices. And if supply's tight, countries that depend on imported fertilizer may start competing against each other for what's available.

[00:08:33]That's why the crisis can become an inflation story even for people who never think about oil markets.

[00:08:38]You may not buy crude oil directly. You may not buy ammonia or urea directly, but you do buy food. You do pay for transport. You do buy goods that were manufactured, shipped, packaged, cooled, and delivered using energy.

[00:08:52]So, when energy and industrial inputs become more expensive or less available, the pressure eventually lands on ordinary households. The helium part's even more surprising because most people still think of helium as something used in party balloons. But, that's not where the real economic importance is. Helium is used in medical machines, scientific equipment, aerospace, welding, rocketry, and semiconductor manufacturing. It's especially important because in many of its uses, there's no easy replacement.

[00:09:21]If a factory needs helium for a certain process, it can't always switch to something else.

[00:09:26]If an MRI scanner needs liquid helium to keep its superconducting magnets cold, it can't simply run without it. That's why the Hormuz crisis reaches into places people wouldn't expect, including hospitals and chip factories.

[00:09:40]Science reported that the US is still the biggest helium producer in the world, about 43% of the global total, but Qatar is right behind it with 33%.

[00:09:49]Next is Russia, followed by Algeria and Canada.

[00:09:52]So, that means 1/3 of global helium production is now literally bottled up behind the Strait of Hormuz, a much higher percentage than world oil production, where the situation is bad enough already.

[00:10:03]On top of that, Qatari natural gas facilities have been taking Iranian drone and missile strikes, which is not going to help the supply chain much, either.

[00:10:12]This is one of the most important details in the whole story. Around a third of global helium supply comes from Qatar, and that supply is exposed to the Strait of Hormuz.

[00:10:22]So, while the world is mainly focused on oil, another critical supply chain is under pressure at the same time.

[00:10:27]That matters because major chip-making countries like Taiwan and South Korea rely heavily on imported helium.

[00:10:34]And in a world already sensitive to semiconductor disruption, any shortage of helium can add another layer of pressure.

[00:10:40]Chips are used in cars, phones, computers, defense systems, medical devices, data centers.

[00:10:45]So, if helium gets more expensive or harder to access, the impact might not look dramatic at first, but it can quietly feed into delays, higher costs, rationing, and production problems across high-tech industries.

[00:10:58]Take a look at this clip where they explain why the US may not feel the full force immediately, but could still be pulled into the crisis through a domino effect.

[00:11:08]Hey, good evening. Good to be with you.

[00:11:09]Well, I think that it's inevitable that if we continue to have a loss of about 13 million barrels per day from the closed Strait of Hormuz, that eventually, like a domino effect, we're going to start to feel more and more of the pain. And you mentioned the pump prices, which have increased to well more than $4 a gallon on a nationwide average basis. And I think that they're on their way to five in the current direction of travel, unfortunately. And so, when people in the Asia hear about this the story that was in the news today about the last oil tanker reaching California before the Strait of Hormuz closed, their attitude is kind of like, "Hey, get in line." Because they were facing that cut off a few weeks ago. That's the region of the world that has the most acute shortage. The United States is exporting a lot of our crude oil, a lot of our refined products around the world to make up for shortfalls. But what do you think is going to happen to prices here if that direction of travel continues?

[00:12:06]The clip explains why this can't be dismissed as someone else's problem.

[00:12:10]Asia may feel the shortage first, Europe may feel it next, but in a global economy, pain doesn't stay isolated. If Asia has less energy, factories slow down. If factories slow down, global goods become harder to produce.

[00:12:22]If global goods become harder to produce, prices rise everywhere.

[00:12:27]If Europe competes for alternative energy supplies, prices rise again. And if the United States exports more crude and refined products to fill the gap overseas, that can keep domestic prices higher than they would otherwise be.

[00:12:39]So, even countries with more energy security are not completely protected from a global shortage.

[00:12:46]This is also why strategic reserves matter so much. Emergency reserves can soften the blow, but they can't solve the deeper problem forever.

[00:12:53]If countries keep drawing down reserves, they're using up the cushion meant for future crises. And if commercial inventories are also being drained, then the world has less protection against the next disruption.

[00:13:05]That's why markets are nervous.

[00:13:07]Investors are not only reacting to today's oil price, they're reacting to the possibility that the global economy is burning through its safety buffers.

[00:13:15]Once those buffers get thinner, every new attack, every new tanker delay, every new supply interruption becomes more dangerous.

[00:13:23]The same logic applies to OPEC. An output increase may sound reassuring, but if the disruption is large enough, a small production increase doesn't fix the problem.

[00:13:32]If millions of barrels per day are missing or delayed, a limited increase from producers is not enough to calm the market.

[00:13:38]And if some spare capacity is located in or near the same region under pressure, then the market can't treat that spare capacity as fully reliable.

[00:13:48]This is why the crisis feels different.

[00:13:50]The world has tools to manage disruption, but those tools are limited.

[00:13:54]Reserves are limited, spare capacity is limited, alternative shipping routes are limited, and time is limited because every day the strait remains disrupted, the cumulative loss grows larger.

[00:14:06]So, the key message is simple. This is no longer just an oil price story. It's a shortage story. It's an energy story, a food story, a technology story, a supply chain story, all at once.

[00:14:19]The renewed Iranian attacks forced markets to confront what they'd been trying to ignore.

[00:14:24]If the Strait of Hormuz remains closed or unsafe, the world doesn't simply pay more for oil.

[00:14:30]It starts competing for less supply.

[00:14:32]And when that happens, the pressure spreads from tankers to petrol stations, from fertilizer markets to food prices, from helium supplies to chip factories, and from global shipping routes to ordinary households.

[00:14:45]That's why stocks plunged, that's why oil climbed, and that's why the phrase approaching pandemic-level shortages is so powerful because it captures the fear that this crisis is no longer contained.

[00:14:57]It's spreading through the hidden systems that keep the modern economy running.

[00:15:02]And once those systems start to fail, the pain doesn't remain on the trading screen. It shows up in prices, delays, shortages, weaker growth, and in everyday life.