The strait is partially reopened and crude oil is cheap again. As the one thing we learned in 1973 is that the world doesn't necessarily return to the old prices, so it doesn't necessarily return to the old assumptions.

At first glance, the $69 price of Brent crude on Friday, its lowest level since late February, sounds like relief. Tankers languishing in the Persian Gulf for three months are now under way. Saudi Arabia has started loading at its Ras Tanura terminal for the first time since March. This week, seventy ships sailed through the Strait of Hormuz in just one day, the most since the start of the war. With the largest supply disruption in the history of the oil market, there's a need for a sigh of relief.

That urge is misguided, and history everyone is constantly searching for has the answer.

Invoking the comparison is the proper way to remember this crisis, but the 1973 comparison is the proper way to remember it. In October 1973 the Arab members of OPEC shut off the taps, removing some 4.5 million bpd from the market, about seven per cent of world supply. It hurt, it tripled the price of crude in a few weeks and it left a generation of motorists standing in lines at filling stations. But it was political. A decision had been made and a decision could be overturned. What Iran did after the United States and Israel attacked its territory in late February was different, in kind. The blockade of Hormuz was an actual blockade. At its peak in March, it shut down nearly 20 million bpd nearly a fifth of the world's oil and a quarter of all seaborne crude. May saw the US Energy Information Administration estimate that Gulf producers were still producing 11 million bpd less than they were before the war. There's no press release that will be able to fix that. Infrastructure is damaged, waters are mined, and shipping confidence is lost, and only months or even years later is their infrastructure repaired.

What 1973 did actually teach us and this is the important point to worry policymakers from Delhi to Dhaka is that it failed to teach us anything. Prices didn't revert back to their former levels. The embargo lifted, the glut of the 1980s rose and fell and the cheap, unthinking oil of the pre-1973 world never returned in its fullness. A crisis isn't just something that passes. Resets the floor. The problem isn't the spike; it's the insurance the world now has to pay for and will pay for forever because it has been scarred. Based on that indicator, the most significant thing about 2026 is not the war itself. Perhaps now, Hormuz is something that cannot be discounted from the price of energy, as it has become a known factor.

There's another break with 1973 that is underutilized and involves different victims. The background of the 1970s shock was directed at the industrialised West. This one hits the hardest on the East. Around 84 per cent of the crude that moves through Hormuz goes to Asia, and the four economies of China, India, Japan and South Korea take the bulk of it. It is exactly the countries with the thinnest cushion, that have grown the fastest in the last 30 years. Vietnam has less than 20 days of reserves. Rationing and queuing are in Pakistan, the Philippines and Bangladesh. China, which is estimated to have around 200 days of food supplies, can endure this much of developing Asia cannot. The world has been turned upside down, with the old rule that an oil shock is a disease of the Western world now reversed.

India has structural and discomfort exposure. It is the third largest importer of oil in the world, importing 88 per cent of the crude that it consumes and historically transporting about 40 to 50 per cent of this oil through Hormuz as well as most of its LNG and virtually all its cooking gas. Immediately after the closure of the strait, it became a tight knot. This is because Indian crude flow through the channel, which was millions of barrels a day, was reduced to a few hundred thousand a day, sending refiners scrambling. The pivot was to Russia, the source of Indian imports, which jumped to nearly half in March, as Moscow's cheap-ended barrels turned into a lifeline instead of a bargain. New Delhi took its own route in the crisis, refusing to join the naval coalition led by the United States, and instead dispatching its own warships to escort Indian-flagged ships home. It tried to do both at once, balancing its diplomatic efforts with Tehran, a modus operandi that is now the hallmark of this country's approach to a splintering world.

It is the macro arithmetic that is where the strain is. The rupee had been identified as the pressure valve, as analysts predicted it would drop below 95 to the dollar, if Brent stayed where it was, and far lower in a worst-case scenario of $120 oil and real shortages. In short, the Reserve Bank did not cut because it did not have to, it was an inflation shock which it could not control. The government used to rely on excise reduction to insulate the pump price before putting the price up once the State elections were over. There's a gentler fragility as well. Nearly one third of all remittances from India are from the Gulf, and half of all Indian overseas workers are in the Middle East, where remittances support the country's balance of payments. There is no such thing as an energy war that is just about energy. It intrudes into Kerala homes as well as refinery margins in Jamnagar. One ray of sunshine, if you can call it that, is that the registration of electric cars increased by 50% year on year in March, due to the impact of the high price of petrol having done the rest of what years of policy pushing had failed to. But, as it happens, crises are persuasive.

The battle this time is not over barrels, but rules and it's the aspect of this story which is least likely to have a tidy ending. Iran has found an asset it is not willing to part with: a 33-kilometre-long channel is the country's least expensive strategic weapon. Iran's Supreme Leader has vowed that the strait will not return to the way it was before, and Tehran's chief negotiator has indicated that Iran might even begin imposing “service fees” on the ships that pass through the strait, waiving the fees only for the sixty day negotiating period under way in Switzerland. What is clear is that the signal is not "abandoned," it is "paused. Washington has made a decision. The US Secretary of State characterized the difference between a toll and a fee as a “game of semantics” and argued that nobody can charge for the use of an international waterway. Oman (which shares those waters) states that any agreement it co-signs will be toll-free and has opened a temporary corridor with UN's maritime agency. In the ensuing hours, Iran's Revolutionary Guard declared the corridor unauthorised and threatened to deal with the ships that deviated from the routes set by Tehran. A container ship was hit by a projectile off the Omani coast, while a rescue of stranded sailors was suspended and resumed this week, and the oil bounced and splashed again. None of this sounds like the actions of a closed crisis.

It is indeed a legal gray zone, and that is why it is dangerous. Transit passage through a strait connecting two areas of open water is supposed to be free under the Law of the Sea; and most maritime lawyers consider that fees are incompatible with the concept of transit passage. But that's not the case in the case of Hormuz it traverses the territorial waters of two countries, not just one, and there never has been a court ruling on the legal issue. The most level-headed analysis by regional experts is that Iran is not necessarily interested in getting hold of the money. The fee is a card to play in case nuclear talks fail and sanctions are reimposed, and a means to let its own hardliners know the war bought it something. That is a "face saving" mechanism masquerading as tariff measures and a threat to shipping doesn't go away with the ceasefire. It hibernates.

Markets have begun to adjust to the new reality in a kind of split personality. Citi sees the price of Brent drifting back to $60 to $65 over six to 12 months as flows return to normal and has advised clients that they should fade any summer rally. However, even if the EIA projects a reopening, OECD inventories will drop to around fifty days of cover by year-end, the lowest level since 2003. Wholesale prices for diesel and jet fuel are more than 60 per cent higher than pre-conflict forecasts, while gasoline is up by about 50 per cent. The world came calling on the one big supplier who was located outside the Gulf: American crude and product exports reached a record. The obvious winners are the tanker owners, as one of the biggest and with the best quarterly profit in 20 years announced a 50% increase in its dividend. Under the oil story lies a food story, with over 30 per cent of the world's urea fertiliser exported from the same Gulf ports, thus making the maritime dispute a question about next year's harvest.

The honest answer, then, to this week is not that the crisis was over, but that it had undergone a metamorphosis. The barrels are on the move and the price is falling, and both those things are good and welcome. But the weaponised strait of February isn't the same strait of January and countries get caught out twice by pretending it's the same. Gratitude that the worst is over is not the proper answer: it is the down-to-earth work of resilience. Larger strategic reserves. Supplies are distributed among forty countries and not in one gulf. Pipelines and routes that do not pass through any one point. An energy transition as a security policy and not a climate virtue. Not to mention the strategic choice of not getting caught up in someone else's conflict when your tankers are being used. For India, the oil shock of 1990 was the catalyst to an economic re-invention. What the crisis does raise is whether the nation and other developing countries that are now in the sights will see 2026 as a scare that can be ignored or a warning that must be heeded. The low-cost oil could return. No one should be tricked into thinking that Hormuz is safe.