The Escalating Crisis at the Strait of Hormuz

Summary

The Journal. – “The Escalating Crisis at the Strait of Hormuz”
March 12, 2026 | Hosted by Jessica Mendoza & Ryan Knutson

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Episode Overview

This episode of The Journal. explores the global implications of the escalating conflict in the Strait of Hormuz, where Iran’s closure of this critical oil shipping channel has become the largest oil supply disruption in history. Host Jessica Mendoza and Wall Street Journal Middle East correspondent Jared Malson break down how the unfolding war and Iran’s tactics have created a global economic shock, the obstacles to reopening the strait, the knock-on effects for oil and food prices, and the limited options for resolving the crisis.

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Key Discussion Points & Insights

1. Iran’s Strategy and the Global Stakes

• Iran’s Intent:
  • Why block the Strait? Iran, militarily weaker than the US and Israel, seeks to retaliate against ongoing airstrikes by imposing global economic costs via the Strait's closure.

    “They are trying to impose economic costs on the US, on the west in general, and on the world at large.” — Jared Malson [01:35]

• Critical Role of the Strait:
  • Normally handles about one-fifth of global oil; closure has sent oil prices surging above $100/barrel, with far-reaching economic consequences.

    “This is the largest oil supply disruption in history.” — Jared Malson [00:37]

2. Military and Strategic Obstacles

• Current Dangers:
  • Iran threatens and attacks any ships attempting passage, using drones, naval mines, and its “mosquito fleet.”

    “Iran pledged it won't hold back. We will never allow even a single liter of oil to pass through the Strait of Hormuz for the benefit of the United States, the Zionists or their partners.” — Jared Malson [05:11]

  • At least six ships attacked in the last 24 hours, causing international alarm.
• Iran’s Arsenal:
  • Swarms of low-flying Shahed drones and underwater mines are effective against civilian tankers not equipped for defense.

    “They’ve used very effectively these one way attack drones... hard to defend against… For civilian oil tankers… they're not set up to defend themselves.” — Jared Malson [05:43]

  • US has sunk much of Iran's large navy, but the smaller, nimble “mosquito fleet” remains a significant threat.
• Asymmetry in Warfare:
  • Iran’s cheap, disruptive tactics force the US and its allies to spend vastly more on defense.

    “Their whole strategy is… imposing costs... The aerial drones cost somewhere in the range of tens of thousands of dollars. The Trump administration is using multimillion dollar air defenses.” — Jared Malson [07:38]

3. Failed Solutions and International Gridlock

• Military Escorts:
  • US Navy escorts have been discussed but deemed "too dangerous" amid active conflict—resources are tied up, risk to ships and sailors is prohibitive.

    “It might even take multiple military ships for each civilian ship just to keep them safe… they’re just not going to try it right now.” — Jared Malson [08:52]

• Options Narrow:
  • Only two real choices: high-risk military convoying or a ceasefire with security guarantees from Iran. Until then, most commercial traffic is suspended.
• Impact on Oil Producers:
  • Gulf states face mounting storage issues; example: Saudi oil storage could fill in two weeks, after which production will need to be cut.

    “You just have to imagine, just like a huge hose, and if you step on the hose, there’s going to be a buildup behind that.” — Jared Malson [13:36]

4. Alternative Routes & Shortcomings

• Pipelines:
  • Only two static alternatives exist:
    • Saudi Arabia’s East-West Pipeline (to the Red Sea’s Yanbu port)
    • UAE’s pipeline to Fujairah (on the Arabian Sea)
  • These relieve some pressure but don’t come close to replacing strait throughput.

    “These two pipelines can relieve some of the pressure, but it is not a total workaround.” — Jared Malson [14:18]

5. Immediate & Ripple Economic Effects

• Oil Prices & Reserves:
  • Oil at $100/barrel; the International Energy Agency is releasing 400 million barrels from its global reserve, more than double any previous emergency release.

    “That is more than double the largest use of the reserve… after the Russian invasion of Ukraine.” — Jared Malson [15:06]

  • Yet, prices continue to rise as markets remain unconvinced.
• Duration Predictions:
  • US Energy Secretary estimates reserve release covers about four months; skepticism remains about strait reopening in that timeframe.
• Beyond Oil: Food & Daily Life:
  • Fertilizer shortages from the oil shock could raise food prices globally, reducing crop yields and worsening hunger.

    “The World Food Program put something out… supply of fertilizer is going to be cut… reduced crop yields, which means more expensive food… people going hungry.” — Jared Malson [16:38]

6. Barriers to Ending the Crisis

• Negotiation Stalemate:
  • No direct negotiations; only third-party, Gulf-state mediation attempts with little progress.
  • US and Israeli governments signal different priorities, with Israel seeking continuation of the campaign and Iran leveraging oil market disruption.
• Potential for Escalation:
  • Journal reporting indicates that forcefully reopening the strait could require a ground operation to seize Iranian coast—an immense escalation.

    “That would mark a dramatic escalation to the conflict.” — Jessica Mendoza [18:59]

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Notable Quotes & Memorable Moments

• On the Gravity of the Disruption:

  “This is the largest oil supply disruption in history.” — Jared Malson [00:37]

• On Iran’s Leverage:

  “The Iranians… have a lot of incentive to continue using the leverage they have over oil markets in order to try to get an outcome that's more favorable to them and just to prove that they can outlast the Americans and the Israelis.” — Jared Malson [18:43]

• On Long-term Repercussions:

  “The second and third order effects of this are enormous and far reaching… we're seeing an even larger disruption now as a result of this conflict.” — Jared Malson [16:38]

• On the Lack of an Easy Solution:

  “There’s just no quick and easy way to reopen the Strait of Hormuz. And without doing that, there is no way to ease the main pressure on the market right now.” — Jared Malson [19:23]

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Important Timestamps

• [00:37] – Scale of oil supply disruption explained by Jared Malson
• [01:35] – Iran’s motives for closing the Strait
• [04:28] – Attacks on ships, military threats detailed
• [05:43] – Use of drones and mines in the strait
• [07:38] – Asymmetric warfare: Iran's low-cost disruption tactics
• [08:52] – US Navy escort discussion and risk analysis
• [13:36] – Oil producers face storage and production dilemmas
• [14:18] – Oil pipeline alternatives and their limitations
• [15:06] – IEA strategic reserve release details and comparisons
• [16:38] – Broader consequences: food price inflation, global hardship
• [17:50] – Lack of diplomatic progress, risk of greater conflict
• [18:59] – Escalation: Possible ground operations and catastrophe for oil markets
• [19:23] – Market effects and no quick resolution

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Conclusion

The crisis at the Strait of Hormuz has set off a global economic shock with severe and far-reaching impacts. The standoff has left over a thousand ships stranded, oil prices spiking, and food security at risk. Military solutions are either too risky or impractical, alternatives are insufficient, and no diplomatic breakthrough is in sight. Both immediate and longer-term consequences for governments, industries, and citizens around the world are mounting, with uncertainty defining the path forward.

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Reporting by Jessica Mendoza, Jared Malson, and supporting contributors from The Wall Street Journal.

Transcript

[News Anchor]

Breaking news now. In the war with Iran.

[Jared Malson]

Iran's new Supreme Leader, Ayatollah Mataba Khamenei

[News Anchor]

has issued his first statement since the war.

[Jessica Mendoza]

Today, Iran released a statement that it said was from its new supreme leader, saying that the Strait of Hormuz must remain closed.

[News Anchor]

So a defiant statement there read out

[Jessica Mendoza]

by a TV presenter because as you mentioned, of course, we still have not seen him. He says that Iran is going to continue. The message marks 10 days since Iran threatened to attack any ship trying to cross the Strait, which is a critical shipping route for oil internationally.

[Jared Malson]

This is the largest oil supply disruption in history, meaning it is causing a global economic disruption that will likely be felt for some time.

[Jessica Mendoza]

Our colleague Jared Malson is a Middle east correspondent for the Wall Street Journal.

[Jared Malson]

The Strait of Hormuz usually handles about one fifth of the world's oil that has contributed to a surge in oil prices worldwide which pushed $100 a barrel this week. And that's going to have all kinds of knock on effects in terms of the price of gas in the US and all over the world. So there are all kinds of second and third order economic effects that are going to happen as a result of this.

[Jessica Mendoza]

So incredibly far reaching consequences all focused on this one kind of body of water.

[Jared Malson]

Exactly.

[Jessica Mendoza]

Why is Iran doing this? Why is it so focused on the Strait of Hormuz?

[Jared Malson]

So Iran is doing this because it cannot defend itself in a conventional sense against the Israeli and US attack that is going on right now. They are by far the militarily weaker party in this conflict. And so what they're doing instead is in retaliation for the US And Israeli bombing campaign. They are trying to impose economic costs on the US on the west in general, and on the world at large.

[Jessica Mendoza]

Is there any sign that the Strait is going to be safe for passage anytime soon?

[Jared Malson]

In a word, no. What we're reporting is that the United States and its partners have no viable way of reopening the Strait of Hormuz while there is an active conflict going on.

[Jessica Mendoza]

Welcome to the Journal, our show about money, business and power. I'm Jessica Mendoza. It's Thursday, March 12th. Coming up on the show, why it's so hard to reopen the Strait of Hormuz.

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[Jessica Mendoza]

If you're trying to get through the Strait of Hormuz today, what obstacles would you be facing?

[Jared Malson]

So the Strait of Hormuz is a narrow body of water between 20 and 25 miles across. And the Iranians have explicitly said that any ships going through there could be struck with drone and missile strikes. And what we've seen is the Iranians attack a series of ships. Iran attacking the flow of Mideast oil. At least six ships targeted in the last 24 hours. There were a couple more today in the last 24 hours near Iraq, where you have these very dramatic images of ships at sea on fire. A Thai cargo ship attacked, three crew missing. One of three vessels struck trying to

[Sponsor Voice]

enter the Strait of Hormuz.

[Jared Malson]

And so the Iranians have already struck a series of commercial ships and they are signaling that anyone who tries to run the strait will be attacked. Iran pledged it won't hold back. We will never allow even a single liter of oil to pass through the Strait of Hormuz for the benefit of the United States, the Zionists or their partners.

[Jessica Mendoza]

And Iran has a number of weapons it can use against vessels trying to cross the strait. Among them drones.

[Jared Malson]

They've used very effectively these one way attack drones. One of those drones is called the Shahed. It's sort of world famous now because they exported them to Russia, who used them very effectively in the war in Ukraine, sending these kind of swarms of drones that are very hard to defend against. They fly at a Low altitude, and in general, these pose a threat to civilian shipping. It's just very hard to defend against them. And for civilian oil tankers, they're civilian ships, they're commercial ships that are not set up to defend themselves.

[Jessica Mendoza]

Another deadly weapon Iran could use are naval mines. Mines deployed under the water, which Iran is saying they're planting in the Strait of Hormuz.

[Jared Malson]

They have a huge stockpile of them, according to military analysts, and they're obviously hard to detect. There are objects that lurk under the water there, and as a result, de facto, it would pose a huge threat to shipping if the Iranians deploy even a small number of them. It would only take one mine hitting one ship for that to cause a huge disaster, both environmentally, economically, and otherwise.

[Jessica Mendoza]

The White House has said that the US has destroyed many ships in Iran's navy already. Does the country have other vessels that the US hasn't yet destroyed?

[Jared Malson]

That's right. So the Americans have obviously gone on the offensive against the Iranian navy, sinking something like 60 of their ships. What we understand is that those are mostly the larger ships in the navy, and it doesn't include this so called mosquito fleet of smaller, fast attack ships that the Iranians have.

[Jessica Mendoza]

Mosquito fleets, drones, close range missiles. While they're not as sophisticated as what the US has in its arsenal, they're all nimble technologies that can have an outsized impact.

[Jared Malson]

It's part of this question of the sort of asymmetric economics of this war where the Iranians can use these smaller, cheaper weapons to cause a lot of damage. And their whole strategy is predicated on this idea of imposing costs on the other side. The aerial drones cost somewhere in the range of tens of thousands of dollars. The Trump administration is using multimillion dollar air defenses in some cases to shoot them down or try to shoot them down. Same with these small boats. It only takes one to blow up an oil tanker. You can see these images of ships on fire in the Persian Gulf right now as we speak. It only takes one of those images to cause panic and anxiety in the oil markets and to scare away shipping lines, oil companies, and governments in the region from even attempting to send oil through the strait.

[Jessica Mendoza]

One potential answer is sending the US Navy to escort ships as they cross the strait. That's something President Trump has brought up as recently as Monday.

[Jared Malson]

But when the time comes, the US Navy and its partners will escort tankers

[Sponsor Voice]

through the strait if needed.

[Jessica Mendoza]

But it hasn't happened yet.

[Jared Malson]

What we understand from our reporting is that the military and the Department of Defense are not planning to do it right now, as long as there's an active conflict going on. What we've been hearing from our sources is that it's just too dangerous. Sending the US Navy or an allied navy to escort these ships would be putting them in harm's way. And it would just be very, very difficult to keep these convoys of ships safe. Right now. The US Navy has a lot of its ships and other assets tied up in those strikes. It would have to divert some of those ships for this purpose. And what we understand from defense officials and from analysts is that it might even take multiple military ships for each civilian ship just to keep them safe. They would have potentially seconds to respond to incoming fire from Iran, which is why they're just not going to try it right now.

[Jessica Mendoza]

So if US Navy escorts aren't a feasible option right now, what others are there for ships that need to cross while the war is ongoing?

[Jared Malson]

There's a few daredevil shippers where they're willing to adopt the risk and try to run through the strait, but for the most part, they're just sitting it out. What we have heard from everyone who is following this situation, oil analysts, shipping industry people, military analysts, is that there's really only two options. It's either these military convoys or a ceasefire. And for a full resumption of normal traffic, meaning more than 100 ships a day crossing through the strait, you would need a cessation of hostilities, along with an explicit sort of guarantee from the Iranians that they're not going to shoot at these ships because it's just too risky. There's lives at stake. There's real money at stake. And for these shipping companies and oil companies, they're just not going to risk it.

[Jessica Mendoza]

Yesterday, Trump said that ships should use the strait. He also said that the strait is in, quote, great shape. Meanwhile, with about 1,000 commercial ships and oil tankers trapped in the Persian Gulf, there's growing pressure on oil and energy markets, and many countries are desperate for a solution. What have you heard from talking to oil executives, specifically from Persian Gulf nations. What is their biggest fear right now?

[Jared Malson]

The chief executive of Saudi Aramco, that's the Saudi state oil company and one of the largest companies, period, in the world, said that a prolonged closure of the Strait of Hormuz would cause catastrophic consequences for the world's oil markets and severely disrupt the world's economy.

[Jessica Mendoza]

Those consequences are already rippling out from the Persian Gulf across the world. That's next.

[News Anchor]

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[Jessica Mendoza]

If oil can't get out through the Strait of Hormuz, it creates huge problems, not just for countries looking to buy that oil, but also for oil producers in the region.

[Jared Malson]

So for countries in the Persian Gulf, there is a sort of deadline on this where they have to get a lot of this oil out or else they are going to have to continue to cut production. A lot of these countries, Iraq, Saudi Arabia, Qatar, they've already cut production. But there's a race to get the oil out before storage fills up. And what we understand is that Saudi Arabia, for example, has about two weeks before it'll run out of storage. You just have to imagine, you know, just like a huge hose, and if you step on the hose, there's going to be a buildup behind that. So that's the dynamic right now.

[Jessica Mendoza]

Is there any other way to get oil out of the Gulf right now?

[Jared Malson]

So aside from the Strait of Hormuz, there are two pipelines that can get Gulf oil to market. One is the east west pipeline in Saudi Arabia that goes to the Port of Yanbu on the Red Sea. Then there's another, smaller pipeline in the United Arab Emirates that goes to the port of Fujairah that's on the Arabian Sea. So these two pipelines can relieve some of the pressure, but it is not a total workaround.

[Jessica Mendoza]

As of today, the price of oil is hovering around $100 a barrel and oil futures are above 100. To try to make up for the oil that's stuck in the Gulf, the International Energy Agency said yesterday that it would tap into a global reserve.

[Jared Malson]

This is a release of this strategic reserve that the International Energy Agency has. So this is a group of nations that together control this reserve. They are releasing 400 million barrels of oil, and that is more than double the largest use of the reserve, which was in 2022 after the Russian invasion of Ukraine.

[Jessica Mendoza]

But it still doesn't seem like it's enough to quell market fears, as you were saying.

[Jared Malson]

No, and we're seeing that today with the price of oil still rising in spite of that announcement. So you're seeing that in spite of these emergency measures, prices are surging because there's just no way around the fact that the Persian Gulf is critical to the world's supply.

[Jessica Mendoza]

On Fox News, U.S. energy Secretary Chris Wright said that this strategic release of oil should cover the global markets for about four months.

[Jared Malson]

How long will that last US and what is your prediction about when this Gulf traffic will resume?

[Sponsor Voice]

Well, the releases certainly out of the U.S. strategic Petroleum Reserve, they'll go over about four months. But this conflict I don't think goes that long. I think we will have the Straits of Hormuz open well before then.

[Jared Malson]

Exactly when.

[Jessica Mendoza]

Regardless, this oil shock could have consequences for everyday consumers well into the future.

[Jared Malson]

The problem is that everyone in general is going to have to pay more for. If you're going on vacation this summer, your plane tickets are going to be more expensive, filling up your gas tank, etc. So the cost of food, everything, you know, the World Food Program put something out where they were talking about that. Because the supply of fertilizer is going to be cut. That means that farmers in general will use less fertilizer, which means reduced crop yields, which means more expensive food. It means people going hungry. The second and third order effects of this are enormous and far reaching. And that's something that we saw with the aftermath of the Russian invasion of Ukraine. And we're seeing an even larger disruption now as a result of this conflict.

[Jessica Mendoza]

And traffic on the Strait could take a long time to recover. Even after the conflict ends, ship owners have to feel that their crews and cargo are truly safe. One analyst Jared spoke to noted that even six months after the Houthis stopped their attacks on The Red Sea traffic there still hasn't normalized. Taking a step back, Jared, what are the chances of this conflict ending soon? Is there any chance for negotiations right now?

[Jared Malson]

There are no direct negotiations happening. There are third parties. The Gulf states themselves have tried behind the scenes to try to defuse this crisis. That's something they've really consistently been trying to do since before the fighting started. But at the moment, it doesn't look like there's any hope of that. For one thing, the US has sent mixed signals about how long this is going to continue.

[Jessica Mendoza]

And while stopping the fighting could soothe global markets in the near term, there might be some far reaching political consequences. Notably, a hostile regime in Iran could create security issues for US Allies in the region, possibly paving the way for another devastating war. There's also no indication that ending hostilities is going to be simple. Jared says the Israeli government has signaled that it wants to continue fighting.

[Jared Malson]

And then the Iranians themselves have a lot of incentive to continue using the leverage they have over oil markets in order to try to get an outcome that's more favorable to them and just to prove that they can outlast the Americans and the Israelis.

[Jessica Mendoza]

Which means that reopening the Strait of Hormuz may require a ground operation to seize the Iranian coastline. According to Wall Street Journal reporting, that would mark a dramatic escalation to the conflict. If this keeps going, how catastrophic could this really be for the world's oil markets? Would you be able to paint a picture?

[Jared Malson]

I think we're seeing that catastrophe unfold right now. You know, the markets were initially slow to price in a prolonged disruption to the Strait of Hormuz. And I think that right now the world is waking up to that to some degree. And the Trump administration has sort of seesawed in terms of how they say the war is going to unfold. Some of that messaging is likely geared towards calming the oil markets. What our reporting shows is that there's just no quick and easy way to reopen the Strait of Hormuz. And without doing that, there is no way to ease the main pressure on the market right now. It's not controversial to say that this is already a global economic disruption and it's not going to be resolved anytime soon.

[Jessica Mendoza]

That's all for today. Thursday, March 12 the Journal is a co production of Spotify and the Wall Street Journal. Additional reporting in this episode by Rebecca Fung, Shelby Holliday Summer Saeed, Yaroslav Trofimov and Joe Wallace. Thanks for listening. See you tomorrow.

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