The Last Ship Out of Hormuz: Why the REAL Supply Shock Is About to Hit | Rory Johnston

In this urgent episode of Hidden Forces, host Demetri Kofinas sits down with commodity economist Rory Johnston to dissect the escalating crisis following the closure of the Strait of Hormuz, a vital artery for global oil supply. With the U.S.-led military campaign against Iran entering its second month, Johnston explains how the physical impact of the supply shock is only now reaching end markets across Asia, Europe, and North America. He details the fracturing of the global oil market both geographically and temporally, with middle distillates—diesel, jet fuel, and other critical fuels—becoming the epicenter of the crisis due to tight supply and limited alternatives. While the U.S. remains relatively insulated due to its domestic production and strategic reserves, other nations face severe rationing, fiscal strain, and forced behavioral changes. Johnston warns that the market’s current backwardation and paper-based optimism are masking a growing physical scarcity, with the final ships from the Gulf still en route to their destinations. He forecasts that by late April, supply chains will unravel, forcing a reckoning with the true cost of the disruption. The conversation then turns to long-term structural shifts: accelerated electrification in Asia, a renewed focus on supply chain resilience, and a potential boom in non-OPEC production from the U.S., Canada, Brazil, Guyana, and Argentina. Johnston also explores two dominant geopolitical scenarios: a 'unilateral Trump taco'—where Trump abruptly withdraws U.S. forces, leaving the Gulf states to pay Iran for passage—or a full-scale 'boots on the ground' invasion that could trigger catastrophic attacks on upstream infrastructure, leading to a $200+ crude price and global recession. He emphasizes that even the most optimistic outcomes are unstable and unsustainable, with the crisis setting the stage for a recurring cycle of conflict and disruption. Ultimately, Johnston argues that this moment marks a pivotal shift in global energy security, with the Carter Doctrine effectively dismantled and the U.S. no longer the guarantor of Gulf stability.