<p>Systemic Risk Assessment of Geopolitical Energy Shocks: A Macroprudential Stress-Test Framework for Strait of Hormuz Disruption and Cross-Border Transmission to Sovereign Debt Markets</p>

This study presents a comprehensive stress-test analysis of sustained geopolitical conflict involving Iran, Israel, and the United States, with particular emphasis on disruptions to the Strait of Hormuz the world's most critical oil chokepoint handling approximately 20% of global petroleum consumption (U.S. Energy Information Administration, 2025). Using a Global Vector Autoregression (GVAR) framework informed by Chudik and Pesaran (2015) and structural shock identification methodologies from Baumeister and Hamilton (2019), we model four scenarios ranging from baseline stability to extreme 90% supply disruption. Our findings indicate that an extreme scenario would generate oil price shocks of 220% ($78 to $250 per barrel), triggering catastrophic macroeconomic consequences for import-dependent emerging markets. For Ghana, the analysis projects inflation accelerating to 62%, currency depreciation of 85%, and GDP contraction of 4.2%, with fuel import bills surging from $3.2 billion to $14.2 billion annually. The transmission mechanism operates through multiple channels including supply-side cost shocks (Rotemberg and Woodford, 1996), exchange rate pass-through (Taylor, 2000; Ca' Zorzi, Hahn and Sanchez, 2007), and sovereign risk premium explosions (Alturki and Hibbert, 2021). We identify crisis-alpha investment opportunities in gold, crude oil futures, and defense equities, while recommending immediate policy interventions including monetary tightening, fiscal consolidation, and strategic reserve management. This research contributes to the literature on energy-inflation pass-through in developing economies (De Gregorio, 2012; Auer et al., 2024) and provides actionable intelligence for risk management in an era of heightened geopolitical volatility.