Not just oil: Why, in a world full of bottlenecks like the Strait of Hormuz, even toothpaste can become scarce.
04/28/2026, 09:5804/28/2026, 09:58
Donald Trump has led the global economy into an absurd situation with his war on Iran, says Fatih Birol, head of the International Energy Agency (IEA). It is a gigantic 110,000 billion dollars in size, but is being held hostage by a few hundred armed men – simply by controlling the Strait of Hormuz, which is only 50 kilometers wide in places. Birol says: “That doesn’t make any sense at all.”
“It would be a shame if something happened to your economy”: Under Trump, dependencies become a risk.Image: keystone
A few hundred men here, a 110,000 billion dollar giant there – but it is the giant that, in the words of IEA boss Birol, “receives a big, big, big blow”.
It is important to learn lessons from this, says Birol. One should not rely too much on a single country, not on a single trade route, not on a single energy source. “It’s always risky, you have to diversify.” It is a recommendation that is actually obvious. Popular wisdom advises against putting all your eggs in the same basket. But that is exactly what Europe has been doing steadfastly for decades. Birol calls it “a funny thing”.
Sought-after expert: Fatih Birol, head of the International Energy Agency, explains the possible consequences of the “biggest energy crisis in history”.Image: keystone
After the oil shocks of the 1970s, Europe wanted to free itself from dependence on the Middle East. So it bought more oil and gas from Russia – and in turn made itself dependent. There was too much reliance on Russia, even when Vladimir Putin became sole ruler, even when he annexed Ukraine’s Crimea in 2014. You only woke up when it was too late. When Russia invaded Ukraine in 2022. Putin tightened gas supplies and drove up European energy prices to record highs. Birol said: “Europe paid a high price.”
After that it became “funny” again. Europe fled from Russia into the strong arms of the US energy industry. That seemed sensible under US President Joe Biden. However, this gave rise to the next dependency on liquid gas, which Trump could exploit if Europe “got on his nerves” as much as Federal Councilor Karin Keller-Sutter did.
Spain, for example, apparently got on Trump’s nerves when it refused to help him in the Iran war. According to the Reuters news agency, possible punitive measures are now circulating in the Ministry of Defense, such as the idea of suspending Spain’s membership in NATO.
Now the Strait of Hormuz is the latest dependency. This time, however, it is not Europe alone that is affected. By blocking the strait, the Iranian regime has a stranglehold on global energy markets – and is exploiting this for its propaganda.
Even the USA cannot escape this grip, despite being the world’s largest oil producer. The price of crude oil is formed globally, and when it rises, energy prices rise in the US as well as in Europe. And not only that. According to “Bloomberg”, the expensive oil is now also forcing China’s exporters to increase their prices – from air conditioning to swimming suits to beauty products.
Doesn’t understand how big the challenge is
The world should quickly learn to free itself from the danger of such bottlenecks, also known as “choke points”. There are numerous other, often more dangerous, bottlenecks in the world.
In the global energy market, the Strait of Hormuz is by no means the only “choke point” or even the most important one. There are at least eight bottlenecks, according to a world map created by asset manager Apollo. The most important of these is the Strait of Malacca, located in Southeast Asia, between the Malay Peninsula and the Indonesian island of Sumatra. In calm times, 23.2 million barrels of oil pass through this strait every day, even more than the Strait of Hormuz with 20.9 million barrels.
The geography of oil risk
Figures in million barrels per day.Source: EIA, Apollo. Graphics: jga
And Birol sees even more need for clarification when it comes to rare earths: “The world doesn’t understand how big the challenge is.” She doesn’t understand how much the extraction and, above all, the processing of these metals is concentrated in China. And she doesn’t understand how important these metals are. “Some people think it’s all about screens and electric cars – that’s completely wrong.”
According to the IEA, the concentration of rare earths for special magnets is huge. China accounts for 60 percent of global production, 90 percent for processing and even 95 percent for some other processing stages. These rare earths – 17 elements in total – are “needed throughout the economy”.
For example, in medical technology, electric cars, consumer electronics, AI data centers, radar systems and night vision devices – in hundreds of products. Birol warns: “We are now dealing with a single Hormuz, but there are still many Hormuz waiting for us.”
European companies that produce in China only recently had to realize the explosive political power that rare earths have. Your Chamber of Commerce is sounding the alarm about Chinese export controls on rare earths. Chinese President Xi Jinping had tightened these controls to defend himself against Trump’s confusing tariffs. Trump actually gave in. The controls are now suspended until November this year. The European Chamber of Commerce has now examined the possible consequences in a report – and was itself surprised.
In a survey, almost a third of members said they were affected by the controls. Considering the few controlled substances, the amount of products affected is “unbelievable,” they say. Chamber of Commerce President Jens Eskelund said: “I don’t think anyone really knows whether Europe could even make toothpaste without China.”
Does Switzerland still have toothpaste without China?
Switzerland should better protect itself against bottlenecks where possible, advises Hans Gersbachthe director of the KOF Institute at ETH Zurich. What is important, for example, are stable relationships with the most important trading partners, the USA, the European Union and China, as well as with countries with a similar starting point: economically strong but vulnerable. “These countries have less threat potential.” In general, it is important to get a clear picture of the dependencies. “Transparency is the basis of every smart strategy.” In other words: Switzerland should also ask itself whether it still has toothpaste without China?
The fact that addictions have become a danger has to do with Trump. Adam Posen, head of the Peterson Institute, explained this change in an interview with The Atlantic magazine. Before Trump, the USA would have secured the economic integration of countries like insurance – for example by ensuring global security. Trump turned this insurance into a “protection racket.” Like a “gangster,” he tells people: “You have a beautiful economy here, it would be a shame if anything happened to it.”