The growing apprehensions regarding Iran and the United States may have significant implications for global energy security, economic integration, and security architecture. The Strait of Hormuz's role in global oil trade makes regional geopolitical challenges potentially economic in nature. This study develops a novel Global War Shock Transmission Framework (GWSTF). It applies a phased strategic foresight and Computable General Equilibrium (CGE) simulation approach to evaluate the global effects of a prolonged Iran-US conflict. The study is divided into acute shocks (0-3 months) and long-term systemic risk conditions (>12 months). According to CGE simulations, geopolitical shocks propagate through several linked channels, including reduced oil supply, higher transportation costs, higher risk premiums, and fragmentation of global commerce. Prolonged conflict may increase energy costs, reduce global commerce, and worsen financial instability. Europe and Asia, which import energy, and Africa and the Small Island Developing States, which have insufficient infrastructure, would be most affected by this global mismatch between welfare and production. In addition, indirect spillover effects like inflationary pressures, supply chain disruptions, and financial sector instability may harm even strong nations. The study states that de-escalation, constrained military activity, or diplomatic intervention might radically alter global trends. Geopolitical theory, strategic foresight, and CGE-based quantitative modeling are used to develop a holistic analytical framework to assess the potential transformation of local conflicts into global systemic threats amid intense economic interconnectedness. The findings emphasise the need for better international governance, energy diversification, and preventive diplomacy to avert systemic global instability.
Shah et al. (2026) studied this question.