The Strait of Hormuz is the fourth large supply shock thi...

What’s Happening

Real talk: The Fed keeps calling these events rough luck.

In 2020, Covid shut down global supply chains and sent inflation surging. In 2022, Russia’s invasion of Ukraine triggered a global energy and food price shock. (yes, really)

Tariff policies in 2025 disrupted global trade and helped to stall a long-awaited retreat in domestic inflation.

The Details

Now, in 2026, we have war in the Persian Gulf. Commerce has frozen in the Strait of Hormuz — and the script looks eerily familiar.

Recommended Video Gasoline prices are rising — up more than 30% in a month, the largest increase in such a short span since Hurricane Katrina in 2005. Fertilizer is stuck at Middle East export hubs, potentially disrupting planting seasons from Iowa to Africa.

Why This Matters

Economists are again talking about recession risks. Diesel is up nearly 40%, topping $5 a gallon — a serious problem for an economy where trucks, ships, trains, and farm equipment all run on it. Four supply shocks in six years.

The business implications here could be significant in the coming months.

Key Takeaways

• At some point, you have to stop calling it rough luck.
• If something has changed, then we need to start rethinking our models for how business and the economy work.
• A pattern the Fed has missed The need for a rethink starts at the world’s most consequential economic institution: The Federal Reserve.

The Bottom Line

That’s a dangerous world view — and it’s one the Fed has reached before. After Covid, the Fed called inflation “transitory” and was slow to raise interest rates.

Is this a W or an L? You decide.