Turns Out You're Long Diplomacy Now: Oil's Strait to $115 Is Bitcoin's New Worst Enemy

The energy market is writing checks the Fed can't cash. US crude surged above $115 per barrel within minutes of the first Kharg Island strike reports, with Brent crude crossing $111. Gas prices in Los Angeles have already crossed $6 per gallon. The national average stands at $4.14, up from $2.98 the day before the war began on February 28.

This is what a closed strait looks like on your gas receipt. The Hormuz chokepoint normally handles roughly 20% of global oil and gas flows. Since Iran imposed its de facto blockade, global supply has lost approximately 12 million barrels per day — more than the combined shortfalls of 1973 and 1979, according to IEA data. Spoiler alert: 1979 was already the year your dad kept the thermostat at 58 degrees and called it "doing his part."

"When you look at the 1973 and 1979 crises, in both of them we lost about 5 million barrels per day. These oil crises led to global recession in many countries," IEA Executive Director Fatih Birol told the Norges Bank Investment Management podcast. "Today, we lost 12 million barrels per day — more than two of these oil crises put together." Yes, you read that right. We're not just breaking records here, we're speed-running economic disasters like a true degen.

Why April Will Be Worse Than March

Birol also warned specifically about the month ahead. March was partially buffered by cargo ships that had entered the strait before the war began and were still arriving at port. "In April, there is nothing," he said in the same interview. Imagine showing up to a potluck and finding out the host only has instant ramen — and then finding out next month they're serving thoughts and prayers instead.

The full impact of the supply disruption is only now reaching energy markets in real terms. His conclusion to Le Figaro was unambiguous: the current crisis is "more serious than the ones in 1973, 1979 and 2022 together" — combining the oil shocks of both 1970s energy crises with the gas market dislocation that followed Russia's 2022 invasion of Ukraine. At this point, the energy market is basically stacking worst-case scenarios like it's trying to unlock some kind of apocalypse achievement.

How This Reaches Bitcoin

The mechanism is not subtle. The Federal Reserve has no room to cut rates while oil is pricing in a prolonged supply shock. The market currently prices in minimal near-term Fed movement. Bitcoin performs best in easing liquidity conditions — rate cuts, falling dollar, growing money supply. It performs worst in exactly the conditions the Iran war has created: oil-driven inflation, a Fed on hold, and investors rotating into traditional safe-haven assets. Translation: