Perhaps the biggest surprise in the decision to bomb Iran was the forgetting of one simple fact: that a fifth of the oil the modern economy runs on passes through a channel of water about 20 miles wide on Iran’s coast. Through that strait — Hormuz — move some 20 million barrels a day. On March 4th, Iran closed it. Strip out what can be rerouted by pipeline or covered by spare capacity, and the net loss is still 10-14 million barrels a day: twice the oil shock of the 1970s, and enough to tip Britain and the world into depression.

There is a seductive lesson in all this, and it is the wrong one. If a single waterway on the far side of the world can do this to us, then surely the answer is to need its oil less: to electrify faster, build more wind and solar and cut the cord to a volatile and hostile region for good. It is the conclusion every enthusiast of unreliable energy has already reached — and the validation he claims for everything imposed on us so far. It is exactly backwards. Net Zero is the cause of this calamity, not the cure.

In my forthcoming book, I explain why the premature abandonment of fossil fuel is a trap — a policy that appears to work until it doesn’t, by which time it is too late to escape. What is sold as a ‘transition’ to wind and sun is in truth a de-transition: the first move in history down the energy quality ladder, not up it. In the name of Net Zero we have eliminated spare capacity, strategic reserves, redundancy, alternative fuel grades and alternative routes. The Strait of Hormuz is proof that the trap has already sprung.

The trap hasn’t needed much to spring it. On February 28th, during negotiations over Iran’s nuclear research programme, Israel and the US launched a surprise attack. If its aim was to topple the Ayatollahs, it failed: Iran kept its regime, its ballistic missiles and its drones. In return, it closed the strait and promised to fire on any ship that tried to pass. Traffic fell to nothing. As I write, it is still effectively shut.

Closure sent economic shockwaves round the world. Here in the UK, diesel is back above 150p a litre and petrol is climbing. Ofgem has raised the July price cap by about 13.5%, to its highest since early 2024 — gas alone up by nearly a quarter. The OECD has raised its forecast for British inflation this year to 4%, up from 2.5%, named the United Kingdom the hardest-hit economy in the G20 and cut our growth forecast by more than any other member’s. Short-term borrowing costs have jumped three times faster than our neighbours’, the Governor of the Bank of England stands “ready to act”, and the ECIU now has UK food prices on track to be 50% higher by November than at the start of the cost-of-living crisis in mid-2021.

Yet the strangest thing about this crisis is how little it feels like one. Brent currently sits at about $96 a barrel, down from a spike to nearly $140 in early April. The June 2027 future is $80, with the outlook trending back to the 2025 price. Yes — pump, bills, inflation, growth, borrowing are all worse. But all still below the 2021 post-Covid, post-Nord-Stream peak: it feels like more of the same. And the political message, calibrated to calm markets, is that it will all be over soon.

Nothing could be further from the truth.

Start with that reassuring $80 future. It is not a prediction. At its simplest it is a truce between optimists, who expect the crisis to ease and sell accordingly, and realists, who expect it to worsen and buy. The realists never declare what they think oil will actually cost — that would mean paying more than they need to. They simply agree the lowest price that clears out the optimists. In a deteriorating supply situation each round clears out the most optimistic, and the price creeps upwards. Then the shortage becomes real, and that is the sting in the scorpion’s tail: the price can look tame for months and then, in a handful of trading sessions, snap up to the scarcity number. The scarcity number is not $80. Serious forecasters put it at $150 or more, as soon as this summer.

Can the shortfall be made up? Some of it. Pipelines that bypass the strait might carry 3.5-5.5 million barrels a day. OPEC+ spare capacity is disputed — and much of it sits behind the same blockade. Norway is at peak, Russia cannot add capacity in this timeframe with its export terminals under drone attack, and US shale — which never paid its way even on cheap post-Covid debt — is tipping into decline. All told, with some demand destruction, the shortfall might be cut to 10-14 million barrels a day. That is still twice the Arab and Iranian shocks of the 1970s, which multiplied the oil price two- to four-fold. This is not more of the same. It is the largest oil shock in history — and it has barely begun.

The reserves held for exactly this moment will help, and they will not be enough. The largest coordinated release in the International Energy Agency’s history — 400 million barrels, agreed in March — covers four to six weeks of the shortfall; empty every government reserve on the planet and you buy three or four months. The one major power filling its tanks rather than draining them is China, now sitting on the biggest stockpile on earth — which tells you what Beijing, the world’s largest builder of wind and solar, really expects. Reserves buy time. They do not make oil.

And the hunt for the missing barrels hides the deeper problem: grade. Not all oil is the same oil. Gulf crude is medium and sour — the heavy, sulphurous stuff refineries turn into diesel, jet fuel and heating oil. The replacement barrels on offer — American shale, West African — are light and sweet: more petrol, less diesel. Match the lost volume barrel for barrel and you are still short of the fuel that matters. Petrol is a consumer fuel. Diesel is the production fuel: it harvests, processes, refrigerates and hauls our food, moves our freight and runs the machinery the whole economy sits on. The world can be awash in oil and starved of diesel at once.

How bad this becomes depends, above all, on how long it lasts. A shock of a few weeks is survivable. A shock that runs through the winter and into next year is the depression. So the question that matters most is when the strait reopens — and that is not an economic question. It is a political one.

There are, broadly, four ways out, and none is quick.

It could be reopened by force. But a 20-mile channel is easy to mine and slow and dangerous to clear; even an uncontested sweep would take months, and Iran would contest it.

Iran could capitulate, or its regime could fall. That was a stated aspiration of the February assault, and it did not materialise. A regime that has taken the worst its enemies could throw at it and still holds the one card the world wants has little reason to fold.

The world could simply adjust — rerouting, rationing, doing without — and settle onto a permanently higher, more fragile price: a long grind that ends in recession, not resolution.

Or there is a settlement: a negotiated end to the war in return for the reopening of the strait. It is the only path back to anything like normal — and it runs through Jerusalem. By the American Secretary of State’s own admission, the war began at this point in time because Israel was going to act with or without the United States. It continues in part because Israel’s aim is not a deal with Iran but the fall of its regime. Until that aim changes no settlement may be possible, the strait stays shut and the rest of us pay the bill.

And if the strait opened tomorrow? Wells are shut in, some for good; tankers are out of position; refinery diets have been changed. ADNOC’s chief executive says four months to get back to 80% of capacity, with full normalisation not before early 2027. Strategic inventories then have to be refilled, propping up the price for years. And Iran has demonstrated it can close the channel at will: insurance and freight are permanently re-rated, and the chokepoint has become a tollbooth, charging for passage outside the dollar system.

If that is not enough, the comparison that really matters is not the 1970s — it is 2008. The Great Financial Crash is remembered as a failure of the banks. In truth it began as another energy shock: conventional crude had plateaued around 2006, oil reached $147 by July 2008, and the spike broke the economy at its weakest joint — the over-stretched American subprime borrower, with the biggest mortgage and the longest commute. Leverage was the amplifier. Energy was the trigger.

The difference is that in 2008 we could fight back; now we cannot. Then, government debt was low — 35% of GDP here, around 65 in America — rates had room to cut, and central-bank balance sheets were clean. Today debt is 95% here and 123 in the US; the interest bill alone is £110 billion a year here, $1 trillion there, and climbing; rates are worked to exhaustion; the balance sheets are still bloated from 2008 and Covid. Worse, the shock is the opposite kind. 2008 was a collapse in demand — deflationary — so cutting rates and printing money pushed towards the cure. This is a collapse in supply — inflationary: prices rise as output falls, the stagflation of the 1970s. To fight it you must raise rates — which deepens the slump and detonates a far larger debt bomb. The rescue that saved us last time would now make things worse.

How will it play out? A forecast is unwise, but a scenario is plausible — and it runs like a crash in slow motion, stage by stage, each one visible before it arrives.

For a while yet the world lives off its tanks, and the price stays calm. That ends when the slack runs low: the optimists are cleared out, futures climb to meet spot, and oil goes through $150 a barrel. Britain feels it early, because we already import almost half our diesel and buy it on the open market at whatever the day demands.

Diesel goes first. It rises faster than crude, because the barrels lost at Hormuz are the sour kind diesel is made from. Most of ours now arrives by sea through Rotterdam, so we are bidding against everyone else, with no claim on a Continent that may keep its diesel for itself — and since Grangemouth closed there is less of our own to fall back on.

Next comes the harvest, already hammered by fertiliser costs. September is the heaviest diesel month of the year, and it arrives to find the tanks low. Other governments open their strategic reserves; a full release buys the world a few weeks. We have no such reserve. We left the job to industry, which holds a legal minimum it must not breach — a floor, not a tap a minister can open.

By October the damage is general. Everything costs more to make and to move while the economy slows — stagflation — and the central banks are stuck, unable to print their way out of a shortage. Here it bites hardest: our debt is high, and the Bank may have to raise rates into the slump rather than cut them.

Then winter, when the same fuel that runs the lorries heats the houses, and heating, power and freight pull on it at once. We are a cold country whose people die of the cold: a typical British winter brings almost 26,000 excess winter deaths in England and Wales. And Net Zero has already made warmth dearer, to meet a target that, perfectly executed, would lower global temperature by less than a hundredth of a degree. An island that imports two-fifths of its food, keeps almost nothing in store, and heats more than a million homes straight from the oil tank has no margin left to give, and more will die. The shock does not pass; it settles at a new and higher level, with years of refilling still to pay for. We have thrown away almost everything that would have carried us through it.

So what might we have done? Notice, first, what we will not now be doing: building wind turbines and solar panels. When energy and capital turn scarce, an economy abandons its least valuable production first — and little ranks lower than unreliable generation. We might have reopened our coalfields and restarted Longannet, once one of the largest coal-fired power stations in Europe. But we blew it up. We might have held a strategic oil reserve. We don’t have one. We might have kept a winter’s gas in store. We hold barely a fortnight’s; Germany holds three months. We might have put the North Sea on an emergency footing and routed its crude to Grangemouth for diesel. But we taxed new exploration out of existence, banned new licences and shut Grangemouth down. We might have kept our capacity to make fertiliser and food-grade gases. We closed it, to shave our 0.7% contribution to global emissions. We might even have negotiated with Russia for gas and the sour grades diesel is made from. We refused — and backed a war that has destroyed the Nord Stream pipelines and is steadily wrecking Russia’s refineries and export terminals.

None of this was fate. Every piece of it was a choice. This is what Net Zero means in practice: the steady removal of slack and redundancy — of every margin that lets a system take a blow. We put our faith in scavenging whatever the wind and sun might deliver on the day, and told ourselves the interconnectors and the global market would always catch us. But the wind drops, the sun sets, and when the cold comes our neighbours are short too. The cables and the import terminals are all in place. It is the supply at the other end that has gone.

A serious country treats resilience as a cost worth paying — not from nostalgia for coal or hostility to cleaner energy, but as the ordinary prudence of a nation that would rather not stand on one leg.

This winter will be hard. We in Britain will come through it the way we have come through worse: by keeping our heads, by looking after one another, by holding on for the morning. But coming through it cannot be the end of the matter. It must be the beginning.

Because once it is over, this country has to confront the thing that did this to us. Not the strait, and not the war — those merely pulled the trigger. What loaded the gun was an ideology: the belief that a modern nation can dismantle its own energy system, at ruinous cost, in the name of a meaningless target, and pay no price. That belief will now be tested to destruction, in public, at our expense.

So we should be done with it — and with the machine built to serve it: the Climate Change Committee, the Department for Energy Security and Net Zero, the subsidy harvesters, the quangos, the consultants, the lobbyists, the lot. Put serious people, with serious ideas and the ability to execute them, in charge of building the energy system Britain actually needs: one that keeps the fossil capacity we cannot yet do without — our own sovereign resource, production and refining — while we build the one source of power that can carry a modern country up the energy quality ladder when hydrocarbons finally deplete. That source is nuclear. It is the answer, and we have spent a decade pretending we did not need it.

We were told the danger was leaving fossil fuels too slowly. The truth, paid for this winter in full and perhaps for years to come, is that we left them too soon — before we had built the thing that could replace them. Let it be the last bill of its kind we ever agree to pay.

Richard Lyon writes State of Britain on Substack. His book, The Energy Trap: Why the Renewable Energy Transition Can’t Work — And What Can, is published by Swift Press on September 24th and is available for pre-order.