Climate scientists and economists are monitoring a projected strong to potentially record El Niño expected by late 2026 [3].
These converging environmental and geopolitical factors matter because they threaten to destabilize global energy markets and disrupt weather patterns. The intersection of extreme climate events and instability in critical shipping lanes creates a volatile environment for oil and gas pricing.
Recent models indicate that a strong El Niño could develop by the end of this year [3]. This follows earlier patterns where an El Niño had an 82% chance of occurring between May and July 2024 [1]. Historical data shows that only four super El Niño events have occurred since 1950 [2].
While climate shifts pose a long-term threat, economists are also analyzing immediate risks in the Middle East. Tensions in the Strait of Hormuz continue to flag energy-security risks [2]. The region remains a critical chokepoint for global oil flow, a fact highlighted by reports of a single tanker arriving off Basra, Iraq [4].
Warming ocean temperatures in the Pacific Ocean region are driving the probability of these climate events [1]. When these temperature spikes coincide with geopolitical crises, the resulting economic pressure can lead to sharp increases in energy costs.
Economists said that the combined impact of a rare super El Niño and the Strait of Hormuz crisis could reshape the global energy outlook [2]. The potential for a record-breaking climate event in 2026 adds a layer of unpredictability to an already strained global supply chain.
“Only four super El Niño events have occurred since 1950”
The convergence of a potentially record-breaking El Niño and geopolitical instability in the Strait of Hormuz creates a 'perfect storm' for energy markets. While El Niño typically disrupts agriculture and weather, its overlap with shipping disruptions in the Middle East could amplify inflationary pressures on fuel and food, forcing nations to accelerate their transition to renewables to mitigate external shocks.
