Fitch Ratings has warned that global energy prices will rise following the effective closure of the Strait of Hormuz, one of the world’s most critical oil transit routes.

The London-based rating agency has raised its 2026 Brent oil price assumption to $70 per barrel from $63, citing heightened geopolitical risks linked to the Iran conflict.

Fitch notes that while the spike -may be temporary, “the geopolitical risk premium is substantial, and there is uncertainty over the duration of the conflict and transit disruption.”

In its latest report, Fitch highlights that the disruption has also pushed European gas prices higher, reflecting cold weather, reduced US supplies, and conflict-related supply cuts in the Middle East.

“The higher 2026 TTF assumption reflects the Middle East conflict, cold weather, and lower supplies from the US,” the agency said, while also projecting that 2027-2028 Henry Hub gas prices will rise due to “higher domestic demand and LNG export economics.”

The report emphasises that despite global oversupply before the conflict, about 20 million barrels of crude and petroleum products per day normally transited the strait, representing a quarter of global seaborne oil trade.

Fitch warns that any prolonged closure could push annual average oil and gas prices even higher, while alternative export routes remain limited.