Overview

The acute shock period spans six weeks of near-total Strait of Hormuz closure following U.S.-Israeli strikes on Iranian infrastructure, producing the largest geopolitical oil supply disruption in modern history. Approximately 20% of global oil supplies was removed from the market — 3 to 5 times larger than any prior comparable event (1973 Yom Kippur War, 1979 Iranian Revolution, 1990 Gulf War, or 2022 Russia-Ukraine war). The period ended with the April 7, 2026 provisional ceasefire agreement.

Key Events in This Period

Defining Characteristics

This period is defined by maximum supply destruction and maximum price uncertainty simultaneously. The WTO AIS tracker confirmed a ~95% collapse in Hormuz transit, with commercial shipping effectively halted. The EIA quantified production shut-ins at 7.5 mbd in March 2026, rising to 9.1 mbd in April 2026. No prior geopolitical event had removed this magnitude of supply — the Dallas Fed confirmed the closure's scale at "close to 20% of global oil supplies" and explicitly assessed it as 3–5× larger than any prior modern shock.

Price uncertainty was acute: Brent averaged $103/b in March 2026 (spiking to $119/b per Reuters), with institutional forecasts diverging sharply — EIA central case at $115/b Brent, Morgan Stanley/JPMorgan warning of $150–$180/b if the Islamabad summit failed. Physical markets were already pricing near $150/b (WTI Midland Europe at a record Dated Brent +$22.80/bbl CIF Rotterdam by April 14), far above futures.

The period ended not through resolution but through a provisional ceasefire that left fundamental questions — sanctions relief compliance, $2M/vessel fee commercial viability, Hormuz normalization timeline — unresolved.

Source

Compiled from multiple institutional sources including EIA STEO, IEA OMR, OPEC MOMR, and news reporting on the Hormuz closure acute shock period (Feb 28 – Apr 6, 2026).