UN Trade and Development (UNCTAD) has warned that disruptions in the Strait of Hormuz have escalated into a systemic global risk, as ship transits through the chokepoint have collapsed by nearly 95%. Given that the Strait carries around one-quarter of global seaborne oil trade, the disruption has triggered sharp increases in energy prices, freight costs, and war-risk insurance premiums, with immediate spillovers into global financial conditions.
To track these cascading effects, UNCTAD has launched a real-time Hormuz dashboard, designed to monitor interconnected risks across shipping, energy, food, and finance. The analysis highlights a critical “gas to grain” transmission, where disruptions in energy and fertilizer supply chains are now feeding into risks for global food production and prices.
The shock is already straining developing economies, with currency pressures, rising borrowing costs, and weakening investor sentiment. UNCTAD’s latest Global Trade Update notes that while trade showed early recovery signs in 2026, this disruption is now dampening investment and demand, increasing vulnerability across import-dependent economies.
Overall, the dashboard signals a shift from isolated supply shocks to multi-sector systemic risk, underscoring the need for early-warning tools in managing global trade disruptions.
Key Statistical and Risk Benchmarks
Transit Collapse: Ship movements through the Strait have fallen by about 95% since disruptions began.
Energy Stakes: The Strait handles roughly 25% of all global seaborne oil trade, alongside significant LNG volumes.
Financial Strain: Developing economies are experiencing falling stock prices and rising external borrowing costs due to the shock.
Food Security: Fertilizer disruptions are increasing risks to food prices, particularly for countries with high import bills and limited fiscal space.
Comparison Metrics: The new dashboard allows users to compare the current crisis with COVID-19 and the Ukraine war supply shocks.
Policy Relevance
Secures Energy and Fertilizer Supply: India relies heavily on the Persian Gulf for both crude oil and urea components; the 95% transit drop underscores the urgent need to operationalize alternate routes like the International North-South Transport Corridor (INSTC).
Mitigates Imported Inflation: As energy costs feed into transport and food, India's Reserve Bank (RBI) must monitor these "ripple effects" on the Consumer Price Index (CPI) to manage interest rate expectations.
Protects Food Production: The transition from "gas to grain" risks implies potential shortages in imported fertilisers, making it critical for the Ministry of Chemicals and Fertilisers to secure long-term contracts outside the Hormuz region.
Utilises Early-Warning Data: India's trade analysts can use the UNCTAD dashboard to anticipate currency volatility and preemptively adjust export-import (EXIM) policies before shocks fully manifest in domestic markets.
Strengthens Maritime Resilience: The crisis reinforces the necessity of the India-Middle East-Europe Economic Corridor (IMEC) as a strategic hedge against disruptions in traditional maritime chokepoints.
Relevant Question for Policy Stakeholders: As disruptions in Hormuz expose India’s dependence on a single maritime chokepoint, how can policymakers combine route diversification (Chabahar/INSTC) with energy and fertiliser supply resilience strategies?
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