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Unlike recent energy crises, today’s geopolitical shock is destroying supply rather than rerouting it, exposing the limits of the standard policy toolkit. Governments can mitigate its impact on those most exposed, but only if fiscal and monetary policy work in concert.

CANNES—The Gulf ceasefire lasted barely three weeks. After Iranian attacks on three commercial ships in the Strait of Hormuz, the United States struck more than 80 targets, revoked Iran’s oil-sanctions waiver, and declared the memorandum of understanding “over.” Yet the market response was telling: Brent crude rose to around $79 per barrel—a meaningful jump, but far below April’s $120 peak, when the strait was closed outright. That gap between renewed war and restrained prices confronts policymakers with a key question: Is this the road back to blockade, or a violent renegotiation of the terms of passage?