As negotiations between the U.S. and Iran show minimal advancement, the flow of commercial vessels through the Strait of Hormuz has decreased significantly. This situation is causing alarm regarding international energy markets and supply networks. Energy analyst Daniel Yergin, vice chairman of S&P Global, discussed the potential outcomes of an extended disruption with Geoff Bennett.

Yergin noted that markets have handled the shock more effectively than anticipated, largely due to substantial oil inventories in the United States, the world's top producer, along with large stockpiles built up by China. These reserves have prevented a more severe global impact since Iran restricted access to the strait on March 4.

If inventories continue to decline without relief, price increases could begin to appear by July. Asia is already experiencing an energy crisis, with nations heavily reliant on strait shipments facing rationing, shortages of fertilizer and diesel for agriculture. In the United States, effects are visible at gasoline pumps, while Europe contends with jet fuel constraints.

Beyond oil, Yergin highlighted fertilizer as the most overlooked consequence, since the Gulf region supplied one third of globally traded volumes. The disruption coincides with planting seasons in many areas, driving up costs or creating outright unavailability.

The United States is unlikely to face a 1970s-style crisis, given its position as the leading oil producer and lessons from past policy missteps that worsened shortages. This production strength provides insulation in the single global oil market, though it does not eliminate vulnerability to worldwide events.

Even if the strait reopens soon, recovery would not be immediate. S&P Global estimates up to six months to reach 80 percent of prior levels, requiring time to reposition tankers, address damage, and restart production.

Yergin is monitoring inventory trends and negotiation developments, noting Iran's intent to maintain control over the waterway and convert it into a controlled passage, a move opposed by Arab producers and detrimental to the world economy. In California, where average gas prices exceed six dollars, state policies have reduced refining capacity and increased reliance on imports, illustrating risks of heavy-handed interventions.