The Strait of Hormuz is closed, and that will impact more than just oil prices.

With the war in Iran not even entering its sixth week, Americans have felt the price of gas increasing. With the gas prices going up a dollar on average, nationwide, many people worry about prices going up further.

However, the problems this closure has caused are much more expansive than the rise in automobile fuel costs. The price of jet fuel has nearly doubled, with United Airlines estimating they paid an additional 500 million dollars in March alone. Should the disruption last much longer, airfares will be forced to increase since jet fuel accounts for 20–30% of airline expenses.

Also being affected is fertilizer, with nearly a third of the world’s fertilizer traveling through the strait. Farmers across the US, already feeling the pain from President Trump’s trade wars, have begun planting less fertilizer-dependent crops. This will likely lead to an increase in the price of foods like sugar, vegetable oil, and wheat.

More than the food and oil, 20% of the world’s helium also travels through the Strait. Combined with the blocking of aluminum exports, this poses a major challenge for semiconductor producers who need both helium and aluminum. This could lead to a price increase in semiconductors, increasing the price in everything from radios to televisions and, most importantly, computer chips.

The helium shortage cannot be easily fixed in the short term, not as long as the Strait is closed, and this could lead to a chip shortage for data centers critical to the development of AI.

Any slowdown in AI spending risks popping a massive bubble. Should the AI bubble pop, hundreds of billions of committed spending will be canceled, and the cascade could lead the US into an economic recession.

The only solution to all of this is to reopen the Strait of Hormuz, which will likely only be done if either the US and Iran find a diplomatic solution or the US puts boots on the ground. As long as Iran can send drones and missiles at ships in the gulf, the Strait will remain closed.