U.S. and Israeli attacks on Iran—along with the subsequent skyrocketing oil and gas prices—are leading many to wonder if the world is facing another energy crisis like the one in the 1970s.
Over 50 years ago, several Arab member states of the Organization of Petroleum Exporting Countries (OPEC) cut oil production and restricted exports to certain nations to protest U.S. support for Israel during the Yom Kippur War. This move sparked a global oil crisis and triggered an oil shortage in the U.S., which at the time imported more than a third of its oil. The price of oil , and U.S. shortages caused panic buying at gas stations and from home heating to the introduction of road speed limits. The 1979 Iranian Revolution then sparked a second oil shock.
One key difference between now and then, however, is that before the 1970s oil crisis, very few countries maintained emergency oil stockpiles—a practice many nations adopted in its aftermath.
The , formed in the wake of the crisis to coordinate a collective response to major oil supply disruptions, now recommends member countries hold at least 90 days of oil reserves. The U.S. also established its Strategic Petroleum Reserves as a result of the 1970s crisis. But today, fears of a sharp oil price hike are driven by the potential long-term closure of the Strait of Hormuz.
Iran borders the —a critical shipping lane linking the Persian Gulf to the Gulf of Oman and the Arabian Sea. “It’s an extremely narrow choke point; if it’s closed or passage is restricted, there’s no alternative route,” says Jim Krane, energy research fellow and Middle East specialist at Rice University’s Baker Institute.
President Trump has that the Iran war could last four to five weeks—or go “far longer.” Continued regional tensions could disrupt global energy markets significantly and trigger widespread inflation. As of Tuesday morning, Brent crude oil prices reached as high as $83 per barrel. After Qatar halted production on Monday, daily freight rates for liquefied natural gas (LNG) tankers surged by more than 40%.
“This will have a broad impact on energy markets—not just in the Middle East or Asia, but also to some extent in Europe,” says Karen Young, senior research scholar at Columbia University’s Center on Global Energy Policy.
Every day, the strait handles a fifth of global oil production, a fifth of LNG shipments, and a third of global trade. Several oil tankers passing through the strait have already been attacked, and many major shipping companies have suspended transit. On Tuesday, an Iranian official stated the country will “set fire to anyone who tries to pass through” the Strait of Hormuz, the .
Reduced supply will lead to higher prices, with Asia bearing the brunt—countries like India and South Korea rely heavily on Persian Gulf oil and gas.
Krane notes this impact will touch people in countless ways: “Over 90% of global transportation depends on oil—for cargo, passengers, planes, ships, or your car—all require oil.”
“Plastic is derived from oil or natural gas, as are heating, air conditioning, and cooking—all of these become more expensive when there’s a shortage or supply constraints,” he continues.
While a daily oil shortfall of around 10 million barrels may occur in the coming weeks, Young says some factors will avert a severe shortage. “Saudi Arabia sent a large amount of oil to Asian customers and then stored it, so they have some stockpiles,” she explains.
She also points out that some countries may reconsider buying sanctioned oil. “Numerous tankers carry sanctioned oil from Russia and Iran but haven’t been able to sell it—they’re floating in the ocean. So there could be pricing shifts or incentives to purchase this oil.”
Young identifies natural gas prices as the biggest risk for instability: “We don’t have many alternative LNG sources available.” Ninety percent of LNG shipments through the Strait of Hormuz go to Asia; South Korea has already activated an emergency response to prepare for potential energy impacts.
Analysis from suggests the U.S. will likely face limited impact, as it’s a major LNG exporter.
A prolonged conflict could drive further inflation. “Every item you buy or consume has an energy component,” Krane says. “When energy prices rise, it pushes up the cost of everything else.”
This comes as Trump’s tariffs have already increased U.S. inflation by 0.7 percentage points, raising prices for American consumers, according to research from the National Bureau of Economic Research.
The uncertainty has led climate groups like Greenpeace International to renew calls for countries to enhance energy security via renewable energy investments. This is a step many nations considered after Russia invaded Ukraine, which forced Europe to prioritize renewables—now the bloc spends more on clean energy than fossil fuels.
At the daily level, rising pump prices could prompt consumer shifts, Krane says: “If oil can’t get through the Strait of Hormuz, driving an electric vehicle becomes much more desirable.”