Before we explain more about the fallout from the war in Iran — and before you listen to the sounds of rare whales — let’s get caught up:
The Trump Administration will dismantle an ocean monitoring system: The administration is planning to remove a $368 million deep-ocean observation system that was put in place a decade ago to monitor coastal environments, marine ecosystems, warming waters and powerful currents.
Cash back for replacing a gas stove with an electric one? Not anymore: The Energy Department has issued new guidance that could prevent people from receiving rebates for replacing gas appliances with electric ones. It would prevent states from offering rebates to people who buy an electric stove to replace a gas range and end rebates for similar swaps of ovens, dryers, heat pumps and water heaters.
The Iran war’s long, troubling fallout
The American stock market continues to roar and gas prices briefly dipped in recent days on hopes of a deal to end the war in Iran.
But across much of the rest of the world, the closing of the Strait of Hormuz continues to disrupt energy markets, agriculture and the basic functioning of daily life.
Large portions of the global supply of oil, gas and fertilizer have been effectively shut off since March, when the United States and Israel attacked Iran. And as The Times reported last week, the fallout is spreading, with developing countries bearing the brunt of the shortfall.
“It’s not just a price shock, it’s explicit shortages,” Krishna Srinivasan, a director at the International Monetary Fund, told The Times.
Companies with strategic reserves of oil and gas are tapping them, while countries without backup are conserving energy. Tech companies and drugmakers are paying higher prices for helium. Crops are being planted in depleted soil as fertilizer runs short. Businesses, restaurants and hotels are closing for lack of fuel. Airfares are rising sharply.
“The Strait of Hormuz is the most critical choke point in global energy markets, and a prolonged closure would become far more than an energy crisis,” Peter Martin, head of economics at Wood Mackenzie, a research firm, said upon the release of a new report on the ramifications of the strait’s closure. “The longer disruption persists, the greater the impact on energy prices, industrial activity, trade flows and global economic growth.”
In the report, Wood Mackenzie predicted that without a near immediate reopening of the vital shipping passage, the world would slip into a shallow recession in the second half of this year, with global gross domestic product growth dipping below 2 percent.
A longer disruption is expected to throttle economic growth in the Middle East and depress economic activity across Europe, the United States and Asia.
The International Energy Agency is tracking the myriad ways in which countries around the world have been trying to conserve energy.
Bangladesh has limited the use of air-conditioning and instituted rolling blackouts. Egypt has told public sector employees to work remotely for one day a week. India has capped the use of natural gas. Zimbabwe has increased the ethanol content in gasoline.
No clear fix
As The Times reported, “before the war, roughly a quarter of the world’s seaborne crude oil and a fifth of the world’s liquefied natural gas passed through the strait.”
The strait was also a main passageway for essential components for fertilizer and plastics, including naphtha, a liquid made from petroleum that is a linchpin for many industrial products.
There is no easy replacement for all that supply.
Speaking at a conference last week, Chevron chief executive Mike Wirth said that the initial disruption in energy prices had been less intense than some had expected because the industry had better than usual inventory coming into the crisis, and because a substantial amount of oil was already in transit.
But Wirth said he expected sharper price increases to hit as early as this month.
“The buffers and the shock absorbers are being steadily drawn down and the ability for the market to absorb this imbalance is drastically diminished today versus where we started,” he said.
The effect on agricultural prices have been more acute.
Wheat price futures have jumped nearly 30 percent, as fertilizer shortages, along with drought, have resulted in the lowest U.S. wheat stocks in more than a half century. The impending arrival of a particularly strong El Niño is expected to worsen the situation.
Josh Linville, vice president of fertilizer with StoneX, a financial services company, told AgWeb that the near record-high fertilizer prices will persist through the end of this year and possibly into the spring of 2027, in the United States and abroad.
That is already leading to predictions of lower harvests and fertilizer shortages in the years ahead.
As the shortfalls continue, experts are warning that food security could become an issue for developing nations. “The clock is ticking very hard,” Máximo Torero, chief economist at the U.N.’s Food and Agriculture Organization, told The Associated Press.
Adapting
Beyond simply rationing energy, the world is scrambling to adapt.
Many countries are turning to China for cheap solar panels. Chinese exports of solar panels reached a record 68 gigawatts of capacity in March, roughly equivalent to the entire solar capacity of Spain, according to Ember. Fifty countries, including Australia, India, Egypt and even the United States, have set monthly records for the highest Chinese solar imports.
In April, Belgium said it would nationalize its nuclear power plants, the BBC reported, to ensure they keep running.
Farmers are looking for new solutions as well. In countries including Brazil and Senegal, The Associated Press reported, some farmers are giving up chemical fertilizers in favor of compost and natural alternatives. And in India, the government is encouraging the use of natural farming practices.
But with no end to the crisis in sight, countries around the world are bracing for more disruptions ahead.
Listen
Dive into a noisy sea with some very rare whales
Fewer than 100 Rice’s whales remain on Earth. They live only in the Gulf of Mexico, where air guns firing sonic blasts are used to survey the ocean floor for oil and gas. The low frequency of the blasts overlaps with the frequency of the calls of the whales.
The Gulf of Mexico, which the Trump administration calls the Gulf of America, is one of the noisiest bodies of water in the United States. Air gun blasts are the loudest element there, according to research by scientists who monitor underwater acoustics. Shipping traffic is another major contributor.
The noise could affect the ability of Rice’s whales to find food and mates, scientists say. The chronic stress of living in a loud environment could be detrimental to their health. — Katherine Chui and Catrin Einhorn
Here’s what they sound like when they communicate.
Climate law
Blue states sue Trump administration over offshore wind deal
Seven Democratic-controlled states sued the Trump administration on Tuesday over its move to block a planned wind farm off the coast of New York.
The lawsuit seeks to overturn an extraordinary deal that the Trump administration reached in March with the French energy giant TotalEnergies. That agreement saw the government pay TotalEnergies $928 million to abandon plans to build the wind project off New York and another one off North Carolina. — Maxine Joselow
Number of the day
At least $54 billion in insured losses
Last year was the most economically damaging wildfire year on record, according to a new analysis published on Sunday.
It happened even though the total area that burned was relatively small. The Los Angeles fires and a handful of severe blazes in other countries, including South Korea and Spain, drove up losses worldwide to at least $54 billion, the study estimates. It was the highest level of insured losses on record. — Rebecca Dzombak
One last thing
Cuba’s growing trash problem
Mounting heaps of trash have become one of the most visible signs of crisis in Cuba as the government says its oil reserves have run dry. With little gasoline to run garbage trucks, piles of rubbish — some four feet high and half a block long — have increasingly become part of the landscape in Havana, the Cuban capital.
To cope, people have started setting garbage on fire.
Trash piles have come to symbolize the extreme consequences of the Trump administration’s oil blockade on Cuba. But the issue has persisted for more than a decade and reflects Cuba’s struggle to provide basic services. — Ed Augustin and Frances Robles
