The Sydney Morning Herald
· collected 2026-09-18 · by Ambrose Evans-Pritchard
The article discusses four concurrent economic shocks affecting the global economy, emphasizing a spiral rise in commodity prices and bond market volatility. Specifically, it mentions that US 10-year Treasury yields surpassed 5%, while the Bloomberg commodity index has increased by 48% year-to-date, impacting energy, metals, grains, and shipping costs significantly. The author attributes these crises to conflicts in Iran and Ukraine, highlighting how these wars are disrupting global oil, gas, and grain markets.
Written locally by qwen2.5:14b on 2026-09-18,
using this article's own text rather than the other coverage of the
same event (that is the story summary below).
Four powerful shocks are hitting the world economy at the same time.
asserted
shocks → hit → time
They are escalating and feeding on each other, driving a commodity spiral that can end only in an inflationary blow-off.
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that → escalate → off
The effects are ripping through the global bond markets and confronting central banks with an impossible dilemma.
asserted
effects → rip → dilemma
Yields on 10-year US Treasuries have surpassed 5 per cent, smashing through the Maginot defences of Scott Bessent, the US treasury secretary.
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Yields → surpass → Bessent
The Bloomberg commodity index has risen 48 per cent this year, accelerating in pace and spreading in breadth from energy to industrial metals and grains.
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index → rise → metals
The fever has spread to shipping and freight.
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fever → spread → shipping
Lloyd’s List says the cost of a giant VLCC oil tanker on the Baltic Exchange has hit $US1 million ($1.4 million) a day, eight times the cost in January.
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cost → say → January
“What is happening is truly unprecedented,” said Erik Broekhuizen, the head of shipping at Poten & Partners.
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Broekhuizen → happen → Poten
The futures markets are no longer pricing in a quick return to normal, as they were in those first insouciant weeks of the Iran war, when traders still believed in the all-conquering might of the US navy.
uncertain
traders → price → navy
European gas futures are locking in prices through the winter that are three times higher than last winter.
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that → lock → winter
The first two horsemen of this “apocalypse” – conquest, war, famine and death in the Book of Revelation – are the twin wars in Iran and Ukraine, both acts of aggression by atavistic old men who fatally misread their own strength.
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who → misread → strength
These two conflicts are convulsing the world’s interlinked petroleum, gas and grain markets in complex ways.
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conflicts → convulse → ways
The easy part to understand is that Donald Trump’s war has again pushed Brent crude to $US108, and pushed Murban crude for the Asian market to $US127.
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war → understand → US127
It was always likely that Iran’s revolutionary guards would match every stage of Trump’s escalation with counter-escalation, gambling that it could endure the pain longer than he could sustain an unpopular war, one that is fast eviscerating US global credibility.
uncertain
that → match → credibility
If Iran cannot export oil, nobody in the region can export oil.
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nobody → export → oil
The US lacks the military means and policy coherence to stop the regime carrying out this threat; it lacks the interceptors needed to keep defending its own ships and bases and the Gulf economies – at least not without depleting its munitions to levels that endanger US security in the Pacific.
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that → lack → Pacific
The pro-Iran Houthis in Yemen can smell weakness and have closed the trap by seizing the lower coastline of the Red Sea and all but blocking the Bab el-Mandeb Strait to Saudi tankers.
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Houthis → smell → tankers
Trump has tried to dodge the issue by saying the Houthis are not his problem, to the point of turning down an urgent Saudi request for help, but the Houthis are his problem.
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Houthis → try → help
Iranian-controlled militias in Iraq have iced the cake by bombing the Saudi East-West pipeline, until now the conduit for Aramco oil circumventing Hormuz.
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militias → control → Hormuz
We now go into another leg of this oil squeeze with buffers exhausted and operating inventories below the safe floor.
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We → go → floor
US commercial stocks at Cushing are touching “tank bottom” at 22 million barrels.
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stocks → touch → barrels
The scale of strategic failure is breathtaking to behold.
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scale → behold → failure
Less obvious is how Vladimir Putin’s war amplifies the Mid-East shock.
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war → amplify → shock
The Ukrainians have learnt how to knock out Russian refineries with precision drone attacks on the highly engineered distillation towers that are hardest to fix.
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that → learn → towers
A third of Russia’s refining capacity is out of action, forcing Putin to suspend exports of petroleum distillates.
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third → force → distillates
Russia is now importing diesel from India, competing for supply on the world market.
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Russia → import → market
The effects are ripping through the global bond markets and confronting central banks with an impossible dilemma.
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effects → rip → dilemma
Most of the Gulf’s refineries are also bottled up on the wrong side of Hormuz.
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Most → bottle → Hormuz
The headline price of oil drastically understates the gravity of what is happening.
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what → understate → gravity
The stress has switched to diesel, petrol and jet fuel, the products that we consume and that matter for inflation.
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that → switch → inflation
The diesel “crack spread” in New York has quadrupled to levels never seen before, tantamount to oil at $US190.
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spread → quadruple → US190
US diesel at the pump has risen over the last year from $US3.72 to $US6.23 a gallon.
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diesel → rise → US6.23
It is diesel that powers tractors, combine harvesters and the global farm economy, as well as trucking, construction and much else besides.
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that → power → tractors
The diesel horror story will lead mechanically to less planting on marginal loss-making fields, compounding a food shortage in 2027 already building up for other reasons.
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story → lead → reasons
Drone and missile attacks have cut off two-thirds of grain shipments from the global breadbasket of the Black Sea region.
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attacks → cut → region
Putin is actively attacking grain silos and warehouses.
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Putin → attack → silos
The third horseman is the super El Nino welling up in the warm waters of the Pacific.
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horseman → well → Pacific
A study in the science journal by Dartmouth academics concluded that the El Nino event of 1997-1998 led to global income losses of $US5.7 trillion through a domino chain of complex effects.
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event → conclude → effects
This El Nino looks stronger.
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Nino → look → ?
The world enters this episode with lower food stocks, after the European and US droughts, and against a new political backdrop of Hobbesian resource nationalism and state-food hoarding.
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world → enter → nationalism
…and 15 more, not listed.
The Aporia
