Evolve or Dissolve

EDITOR: On April 7, 2026 oil is around US$ 95 a barrel, coinciding with a 2- weeks ceasefire between the US and Iran. Brent crude reaching a peak of approximately $119 per barrel by March 31, 2026.

This is interesting because it was the United States that was aggressively advocating for a ceasefire and Iran agreed, with an important condition- that she will open up the strait of Hormuz but the Iranian military will coordinate the traffic through the straight. The drop from $119 to $95 indicates that while the ceasefire provided immediate relief, the market remains incredibly tense. Iran’s condition- coordinating traffic through the Strait of Hormuz-is a double-edged sword. On one hand, it guarantees the physical flow of oil; on the other, it gives Tehran “regulatory” control over a choke point that handles about 20% of the world’s liquid petroleum.

As of April 5, 2026, OPEC+ has agreed to a modest production hike—roughly 206,000 barrels per day for May—to help stabilize the market. Analysts from Rystad Energy warn that these increases may be “theoretical” because actual export availability is limited by war-related damage to facilities. Saudi Aramco has set its official selling price for May at a record premium of $19.50 above the Oman/Dubai average, signalling that they expect demand to remain extremely tight despite the ceasefire. The gap between global (Brent) and US (WTI) oil has widened significantly, as international markets are more sensitive to the seaborne risks controlled by Iran. Higher shipping and fuel costs are estimated to have added 0.6 to 0.7 percentage points to global inflation, with some countries already implementing fuel rationing.

Analysts from UNCTAD have lowered global growth forecasts for 2026 from 2.9% to a range of 1.5–2.5%. Europe & Japan are most vulnerable due to heavy reliance on Gulf energy import and are likely to be dragged into inflation. The United States is historically more resilient due to domestic production, but facing an 18-20% equity market decline and a 21% jump in gas prices ($4.14/gallon national average) that is curbing consumer spending. In March 2026, the OECD revised its 2026 inflation forecast for the U.S. from 2.4 to 4.2%, citing energy market volatility.

The global economy faces a period of lethargy and inflationary pressure as Iran’s control of the Strait of Hormuz disrupts the world supply of oil, fertilizer, and helium, a critical component for computer chips. This blockade, combined with extensive damage to regional facilities, is triggering widespread supply shortages and driving up costs across multiple industries. Governments like Anguilla are reviewing the temporary removal of import duties, goods taxes, and customs fees on essential fuels like LPG, diesel, and gasoline. Countries like Barbados have “locked in” fuel prices through hedging contracts for example, fixing heavy fuel oil at US$92 per barrel for several months to provide predictable costs for electricity generation. Some administrations are absorbing a portion of fuel cost increases on electricity bills to protect households from sudden price spikes. Shifting to home grown energy is a top priority. CARICOM has set a target for 47% renewable energy contribution to the region’s electricity by 2027. Barbados, Trinidad and Tobago and St Kitts and Nevis are perusing renewable energy development. To combat the shortage of Middle Eastern fertilizers, organizations like the FAO recommend diversifying import sources, strengthening regional food reserves, and investing in input-efficient agriculture. CARICOM leaders need to be more courageous and speak with one voice to advocate for global de-escalation and the protection of international trade routes. Strategies include the free movement of labour and joint development of regional industries to build collective resilience against external shocks. Barbados, Belize, Dominica, and St. Vincent and the Grenadines implemented full free movement as of October 1, 2025. Each country in each CARICOM nation can remain a fragile pebble by pursuing narrow self-interest, or become a formidable rock by synergizing their collective strengths.

Brian Plummer