Journal Article
A Critical-Inputs Playbook: What the Strait of Hormuz Tells Europe
Europe imports only about 4% of the crude and 7% of the liquefied natural gas (LNG) that pass through the Strait of Hormuz. By that measure, the strait’s near-closure since the war began on 28 February 2026 should barely register in European macro forecasts. However, the European Central Bank (2026) cut its 2026 growth projection by 0.3 percentage points and raised its inflation projection by 0.7 in its March 2026 baseline. The ECB’s first rate hike in three years, announced on 11 June 2026, confirms that the inflation channel is no longer hypothetical. At the same time, brent oil traded between US $78 and US $95 per barrel through the spring, and in maritime shipping, war-risk insurance climbed by up to 50% from 2% to roughly 3% of vessel value. By these measures, the (macro)economic hit for Europe is large relative to direct exposure – and Europe may be running the wrong crisis playbook.
