Two-Layer Hormuz Transmission

When a Hormuz closure enters market pricing, the visible shock travels fast: energy reprices, LNG freight spikes, volatility rises, and rates and FX adjust within days. That transmission path is well-documented. What is less visible is the second layer. The second layer is slower, harder to price, and structurally different in character.

This paper documents that second layer. Hormuz is the dominant transit corridor for Qatari LNG and, critically, for a significant share of global helium supply. Helium is a non-substitutable industrial input in semiconductor fabrication: cooling systems, fiber-optic production, and chip manufacturing all depend on it. A sustained Hormuz disruption does not only reprice energy. It creates pressure in the helium logistics chain, which then propagates into semiconductor capacity constraints and downstream AI-compute availability.

The framework is built on a public daily panel running from January 2020 to April 2026, covering seventeen series across energy, freight, rates, volatility, semiconductors, and compute infrastructure. The methodology combines local projections for impulse responses, generalized Morse wavelets for multiscale decomposition, scale-by-scale canonical correlation analysis for cross-block dependence, and Monte Carlo tail diagnostics for stress-regime behaviour.

The key empirical result: at the 64-day horizon, the framework identifies a sparse long-horizon bottleneck: a single Brent–SOX direction with a held-out correlation of 0.825. The quarterly structure sharpens rather than disperses. The first transmission layer is immediate and visible. The second layer arrives later, concentrated at horizons that standard daily coverage will not name on day zero.