S&P's Yergin: "This is The Biggest Energy Disruption We've Ever Seen"

• Current oil prices, while high, are not as severe as 2008-2014 levels when adjusted for inflation, but this could be the 'calm before the storm'.
• The Strait of Hormuz region is deeply integrated into the global economy, supplying critical resources like helium (for semiconductors/MRIs), LNG, and petrochemicals, making this a 'much bigger disruption'.
• There's a growing focus on energy security and resilience, with Gulf countries likely to increase investment to protect themselves, and the US economy faces political pressure from rising gasoline prices.
• The new form of warfare, involving drones and artillery, is being 'beta-tested' in the Gulf, raising questions about the freedom of seas and long-term stability of trade routes.

Daniel Yergin, Vice Chairman of S&P Global, states that the current situation in the Strait of Hormuz represents the biggest energy disruption and security threat in history. He highlights a divergence between financial markets, which seem to underprice the risk, and the reality of physical shortages and economic pain being felt globally, particularly in Asia. The longer the conflict persists, the greater the risk of severe price increases and broader economic impacts.