It's one choke point after another in the global economy
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"Choke point" is having a moment.
Why it matters: The term is an increasingly popular shorthand for the bottlenecks tying up the oil market and the AI buildout — and sometimes the entire economy — as the old global economic order gives way to intensifying competition and outright war.
Where it stands: The latest choke point is in the Red Sea. Saudi Arabia has been routing more oil there via pipeline, bypassing the OG choke point in the Strait of Hormuz.
- Now, Iranian-backed Houthi militants are targeting Saudi ships, threatening traffic through the Bab el-Mandeb Strait — which has seen increased oil flows, about 5.7% of the world's oil in the first three months of 2026, up from around 3.5% over the same period last year, according to Axios' calculation of EIA data.
The big picture: "Middle East risk has become a two-choke-point problem," commodities researchers at Standard Chartered Bank wrote this week.
- Energy prices have surged, with Brent crude trading above $100 a barrel Thursday.
Zoom in: Eddie Fishman saw it coming. Last year, he published a book titled (what else?) "Chokepoints: American Power in the Age of Economic Warfare."
- Since then, "it's been one choke point after another," says Fishman, who worked on sanctions policy in the Obama administration and is now a senior fellow at the Council on Foreign Relations. "It's becoming a concept that has in some ways really just transcended the book."
Zoom out: "I noticed — and so did colleagues — that the term was cropping up with increasing frequency last year," says Andrew Hill, who organizes the Financial Times' Book of the Year Award, for which Fishman's book was shortlisted.
- Apollo's chief economist, Torsten Slok, published a post titled "The Chokepoint Risk" this week, looking at energy supply and demand dynamics. Geopolitical leverage isn't in oil reserves, he wrote, "but in the narrow passages through which the world's oil actually flows."
State of play: Choke points aren't merely geographic, like the straits. They can be economic: dominance over a critical resource (China and rare earths), technology (advanced AI chips) or a financial network (the U.S. dollar), for which there are few ready substitutes.
- Analysts are using the phrase to describe pressure points in the AI market where the supply of certain components isn't keeping up with demand, producing shortages and higher prices.
- "The expansion of AI is currently limited by severe 'chokepoints' in the broader ecosystem," Goldman Sachs analysts wrote in May — they point to strained data center capacity, power shortfalls in the U.S. and more.
Between the lines: During the free trade era, specialization in certain industries or products lowered costs, allowing different players to focus on what they do best.
Friction point: It also created a fragile interdependent system. And now it's cracking up, as countries are more willing to take steps like tariffs and export controls.
The latest: Underscoring choke point's ascendancy in the lexicon, global consulting firm McKinsey just this week released a guide for businesses on how to deal with choke points. It defines them as:
- "Economic dependencies with limited short-term substitutes, in which a single actor, a small coalition of actors, or natural forces could act to alter or restrict the flow of trade or goods through a point or system."
Reality check: Physical choke points have been a fulcrum of power for thousands of years.
- Fishman points to the Peloponnesian War, circa 400 BC. Athens was defeated after Sparta cut off its access to grain through the Black Sea.
Yes, but: Companies' use of "choke point" has yet to catch up with "bottleneck." In earnings conference calls for the previous quarter, "choke point" came up nine times, while "bottleneck" got 904 mentions, a tally from AlphaSense found.
