The Bank for International Settlements (BIS) has issued a stark warning about the long-term consequences of a potential blockade of the Strait of Hormuz, just as Iran and Oman reaffirmed their joint sovereignty over the world’s most critical oil chokepoint. In a report released June 28, the BIS stressed that even if tensions ease temporarily, the structural damage to energy and raw material supplies could persist for years, threatening the sustainability of large-scale investments—particularly in artificial intelligence (AI).
The Strait of Hormuz, a narrow waterway connecting the Persian Gulf to the Arabian Sea, handles around 20% of global oil and significant liquefied natural gas shipments. A blockade, even short-lived, would trigger cascading effects on energy prices, shipping costs, and industrial supply chains. The BIS noted that while the global economy showed resilience in early 2025, buoyed by AI optimism and stronger trade, this momentum may be short-lived if energy availability becomes unreliable.
On the diplomatic front, a joint statement from Iran and Oman asserted their shared sovereignty over the strait, emphasizing that any foreign military presence must respect the security of both nations. This coordinated move appears designed to counter increased naval activities by non‑regional powers and to reinforce the two coastal states’ legal standing under international law, including the United Nations Convention on the Law of the Sea. While the statement does not impose new shipping restrictions, it adds a layer of diplomatic coordination that could influence future risk assessments and insurance costs for vessels transiting the region.
The confluence of the BIS alert and the sovereignty reaffirmation highlights how geopolitical shocks can weigh on global markets. For crypto investors, the heightened uncertainty—especially if it drives energy costs higher or disrupts tech sector investment—could dampen risk appetite. The BIS explicitly linked the AI boom’s massive energy needs to the risks posed by supply disruptions, noting that the current wave of capital spending on AI infrastructure might not be sustainable if energy remains structurally expensive.
