March 23, 2026
Fatih Birol, executive director of the International Energy Agency, warned that the US‑Israel campaign against Iran and Tehran’s closure of the Strait of Hormuz constitute a ‘major, major threat’ to the global economy. Speaking at Australia’s National Press Club, Birol said the crisis mixes features of the 1970s oil shocks with the fallout from the war in Ukraine, calling it like ‘two oil crises and one gas crash put all together.’ He said reopening the Strait of Hormuz is the single most important step and urged rapid, coordinated diplomatic efforts to de‑escalate.
Markets reacted sharply as the conflict entered its fourth week. Major Asian bourses plunged more than 3% in a single session and European indices opened lower, with Germany’s DAX down over 2% by midday. Safe‑haven assets such as gold and silver saw volatile trading. Traders returned from the weekend in a cautious mood amid reciprocal threats between Washington and Tehran and little sign of a ceasefire.
Singapore’s foreign minister described the situation as having ‘taken the entire global economy hostage,’ warning that a prolonged disruption could trigger a financial crisis and calling the Strait closure, in effect, an Asian crisis. He also expressed surprise at the rapid escalation and questioned the legality of some actions.
Responses from major powers were mixed. The Kremlin urged a political and diplomatic end to hostilities, saying only diplomacy can defuse the catastrophic tensions. China warned the conflict could become uncontrollable if it expands, reiterated calls for a ceasefire, and dispatched a special envoy to pursue de‑escalation. UK prime minister Keir Starmer and US president Donald Trump held a late‑week call agreeing that reopening the waterway is essential, with further consultations expected.
On the ground, Israel said it launched a wide wave of strikes targeting Iranian regime infrastructure in Tehran, with explosions reported across the capital. Iran reported firing missiles and drones toward Israel, and the Israel Defense Forces said air defenses intercepted incoming threats while advising civilians to seek shelter. Israel also reported that an Israeli civilian in a northern kibbutz was killed by friendly fire during an operation and has opened an inquiry.
US Central Command chief Admiral Brad Cooper told the Farsi network Iran International that the US campaign is largely on plan. He accused Iran of launching munitions from populated areas and warned such locations could be targeted, urging civilians to stay indoors.
Tehran has issued stark reciprocal threats. Iran’s Supreme National Security Council warned it would mine all access routes in the Gulf, including using floating mines released from the coast, if its coasts or islands are attacked, a move that would effectively close the Persian Gulf for an extended period. Iran also threatened strikes on power plants in Israel and Gulf states in retaliation for attacks on Iranian power facilities, warning such strikes would endanger regional energy and desalination systems that depend on electricity.
The US president issued a weekend ultimatum threatening to ‘obliterate’ Iran’s energy infrastructure if Tehran did not reopen the Strait of Hormuz within 48 hours; that deadline fell late Monday. Reports said the White House was considering options including occupying or blockading Kharg Island, Iran’s main oil export terminal, to force the waterway open.
Iran has deployed swarms of drones in the campaign and used them to strike neighboring Gulf states, complicating defenses. The growing use of drones, missile exchanges, threats to energy infrastructure, and the possibility of mined waterways have raised fears of prolonged disruption to oil and gas exports and broader economic fallout.
As leaders, envoys and international institutions press for solutions, markets and regional populations are confronting immediate human, infrastructural and economic consequences. Coverage continues as diplomatic efforts attempt to prevent a deeper, wider crisis that could reverberate through global energy supplies and financial markets.