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Wed, 08 Apr 2026

Wed, 08 Apr 2026 Faisal Islam: Iran war pause is welcome but the economic scars will last

Allowing all ships through the Strait of Hormuz will calm markets but the war has created new problems.

* Approximately 800 ships were stuck in the Strait of Hormuz due to the conflict, affecting global supplies of oil and gas.
* The conflict has led to rising petrol and diesel prices, higher airfares, and swelling mortgage rates worldwide.
* A ceasefire has been declared, leading to a 15% fall in oil and gas market prices and a rally in stock markets.
* However, there are concerns about the underlying diplomacy and the impact on prices, interest rates, and economic growth.
* Iran's control of the Strait has created a new reality, allowing it to collect tolls and potentially disrupt global trade.
* The conflict has damaged global gas production, with many countries dependent on supplies from the Gulf region.
* A sustained ceasefire could lead to lower inflation, contained energy prices, and calmer interest rates.
* The absence of further escalation is a relief for the global economy, but the long-term impact of the conflict remains uncertain.