The deadline set by Donald Trump for Iran to comply ends this Tuesday at 8:00 PM in Washington, with Tehran's firm refusal to negotiate under pressure presenting the world with a historic fork in the road: a last-minute agreement, military escalation, or a prolonged standoff. Each scenario carries vastly different implications for the global energy landscape.
Iran took decisive action on March 4 by closing the Strait of Hormuz using mines, drones, and missiles. This move stranded approximately 2,000 ships with 20,000 sailors on board and effectively blocked the passage of 20% of the world's oil and liquefied natural gas.
As a result, Brent crude oil prices have surged from $67 to over $126 per barrel, and gasoline prices in the United States have hit $4.10 per gallon, marking the highest levels since 2022.
Iran's Stance Against Pressure
On Monday, Iranian Foreign Ministry spokesman Ismail Bagaei made it clear: "Negotiation is entirely incompatible with ultimatums, crimes, or threats of war crimes."
Tehran dismissed the 15-point plan sent by Washington, labeling it "extremely ambitious and illogical," and proposed its own five-point counteroffer, which includes the recognition of its authority over the strait.
Potential Outcomes: Agreement, Conflict, or Stalemate
The first and most favorable scenario is a last-minute deal. According to four sources cited by Axios, negotiations are underway for a 45-day ceasefire in two phases, with Special Envoy Steve Witkoff and Jared Kushner in direct contact via text messages with Iranian Foreign Minister Abbas Araghchi.
Trump expressed to Israel's Channel 12 that deep negotiations are ongoing, and he is hopeful for an agreement. Such a deal would provide immediate relief to energy markets but would leave Iran's nuclear program and Tehran's newly passed toll law, which explicitly bans U.S. and Israeli ships, unresolved.
The second scenario involves military escalation. Trump ominously warned on Truth Social that Tuesday could be "Energy Plant Day and Bridge Day" in Iran.
If the promised attacks on Iranian civilian infrastructure occur, Tehran might retaliate against energy facilities in the Gulf, including Saudi Arabia, the United Arab Emirates, and Qatar—key players in global energy production. Analysts project oil prices could exceed $140 per barrel in this scenario, with potential recessionary impacts on Europe and Asia.
On Monday, Israel already targeted Iran's largest petrochemical plant in Asaluyeh—responsible for 50% of the nation's production—and eliminated the head of intelligence for the Revolutionary Guard, Brigadier General Majid Khademi.
The third scenario, a prolonged impasse, could be the most transformative in the long run.
If the blockade persists without resolution, the global energy map could undergo a structural reordering. For instance, Japan, which sources 90% of its oil via Hormuz, faces significant risks, highlighting the potential impact on Asia.
Additionally, analysts note that Qatar may lose its position in the global liquefied natural gas market due to uncertainties surrounding the passage through the strait.
The United States, having already declared minimal oil imports via the Strait of Hormuz, might face less direct harm. However, the effect on its allies and the global economy could challenge the era of the Strait of Hormuz as a reliably neutral route.
Understanding the Global Impact of the Strait of Hormuz Crisis
What percentage of the world's oil passes through the Strait of Hormuz?
Approximately 20% of the world's oil and liquefied natural gas passes through the Strait of Hormuz.
How has the closure of the Strait of Hormuz affected oil prices?
Since the closure, Brent crude oil prices have risen from $67 to over $126 per barrel.
What are the potential consequences of a prolonged impasse in the Strait of Hormuz?
A prolonged impasse could lead to a structural reordering of the global energy map, significantly impacting countries like Japan and altering the global liquefied natural gas market.